A WestJet Link plane is pictured in Lethbridge - Lethbridge News Now photo

By The Canadian Press

Transportation regulator determines WestJet would remain Canadian after Onex deal

Dec 10, 2019 | 4:36 PM

GATINEAU, Que. – The proposed acquisition of WestJet Airlines by Onex Corp. moved a step closer to completion after Canada’s transportation regulator determined the airline will continue to meet Canadian ownership and control requirements.

The Canadian Transportation Agency says the Calgary-based airline and its discount subsidiary Swoop would remain Canadian if Onex amends its bylaws to ensure any matters voted on by the board of directors are done with a majority of Canadian directors being present.

It adds that the requirement to be Canadian is an ongoing requirement and that the agency must be notified of any change to its status.

Onex requested the agency to determine if WestJet and Swoop continued to meet Canadian ownership and control requirements on May 31.

In September, Air Canada challenged WestJet’s $3.5-billion acquisition by Onex Corp., arguing in a filing to the country’s transportation regulator the deal breaches federal rules that limit foreign ownership of carriers.

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Federal legislation limits foreign ownership of a Canadian airline to 49 per cent, with a maximum of 25 per cent for any one foreign investor. Onex, which managed $23.2 billion of invested capital as of Dec. 31, is a private equity firm whose funds include cash from foreign investors.

(The Canadian Press)