Transat Shares Sink to 8-Year Low as Takeover Odds Suffer

(Bloomberg) -- Transat AT Inc., hit hard by the coronavirus pandemic, dropped to an eight-year low as investors bet against a travel recovery and the completion of a takeover by Air Canada.

Shares of Montreal-based Transat have slumped every trading day this month except one. The stock’s 13-session losing streak is its longest since 2008.

Transat has lost about C$475 million ($357 million) in market value this year because of rising odds that a proposed takeover by Air Canada at C$18 a share will fall apart. The deal was struck in August 2019, but has yet to be approved by competition authorities.

Transat is looking for new sources of financing, but it “may require Air Canada’s prior consent” to raise money because of clauses in the takeover agreement, the company said Sept. 10.

Canada and the U.S. recently extended an agreement to restrict travel between the two countries until Oct. 21, and the Canadian government continues to advise residents against non-essential travel outside the country. Passengers coming into Canada must quarantine for 14 days, though Transport Minister Marc Garneau said last week the government may loosen that restriction.

©2020 Bloomberg L.P.