Brian Dunn/MONTREAL
Canadian Regional Airlines (CRA) has been put up for sale, satisfying a key requirement stipulated by regulators when approving the deal which has seen its parent, Canadian Airlines International, purchased by Air Canada.
Calgary-based CRA is to be sold through a blind auction, with a minimum asking price established - unknown to bidders - and the airline going to the highest offer above that price. If no bidder matches the "reserve" price within a 60-day period running from 30 June, the feeder will revert to Air Canada.
No price has yet been set for CRA, with the Canadian Competition Bureau and Air Canada unable to agree a figure. A US lawyer has been called in to arbitrate and will set a price within the next few weeks. A New York investment bank is acting as selling agent. CRA has 2,000 employees, annual sales of about C$580 million ($390 million) and a fleet of 30 Fokker jets and 24 Bombardier Dash 8-100/300s.
Meanwhile, a number of top managers have left CRA's parent Canadian Airlines after recent court approval of the restructuring of its C$3.5 billion debt by Air Canada. Among those departing are Doug Carty, senior vice-president and chief financial officer, Don Casey, senior vice-president, planning, and vice-presidents Ron Dewar, Brock Friesen, Keith Pope, Barry Rempel and Marshall Wilmot.
Mary Jordon, senior vice-president, customer service and operations, will remain and is expected to head Air Canada's planned discount carrier - probably to be launched later this year. A rival, CanJet Airlines, is to be launched next month.
Air Canada is, meanwhile, moving ahead with plans to consolidate its own regionals, Air BC, Air Nova and Air Ontario. The three - which together have 3,000 employees, 70 aircraft and revenues of C$880 million - will have a single management structure and an operations centre in Halifax, Nova Scotia, but will retain bases across the country.
• Canada 3000's previously announced initial public offering of 3 million shares will be priced at C$10 per share and should raise C$30 million. About C$10 million will be used to lease four Airbus A319s, C$5 million will go on new e-commerce and e-ticketing activities and C$3.5 million will retire long-term debt and redeem shares in a subsidiary.
The balance will help expand domestic services.
Source: Flight International
