Gerald Schwartz controlled Onex closes $5B acquisition of WestJet

Onex Corporation (TSX: ONEX) and its affiliated funds, through Kestrel Bidco Inc., have completed the acquisition of WestJet Airlines Ltd. valued at approximately CDN $5 billion including assumed debt.

Kestrel Bidco is indirectly controlled by Onex Corporation.

The closing comes following the receipt of the final regulatory approval by the Canadian Transportation Agency (CTA) of its determination under the Canada Transportation Act.

WestJet Airlines Ltd. is the parent company to WestJet and Swoop Inc., which hold CTA licences.

The CTA has determined that WestJet and Swoop Inc. would remain Canadian is on the condition that Onex Corporation amends its by-laws to ensure that any matters pertaining to and affecting WestJet Airlines Ltd, WestJet and Swoop Inc, are voted on at board of directors’ meetings where a majority of Canadian directors are present.

The CTA has directed Onex Corporation to provide copies of any document, previously submitted as draft, in their final executed form, within 60 days of the completed transaction. The requirement to be Canadian is ongoing, and for WestJet and Swoop Inc. to remain Canadian, Onex Corporation must remain Canadian.

Gerald W. Schwartz, Chairman, President & CEO of Onex Corporation, holds indirectly all the outstanding Multiple Voting Shares (60% voting power) and 12,099,140 Subordinate Voting Shares representing approximately 12.1% of the outstanding Subordinate Voting Shares of Onex Corporation.

Onex Corporation controls the general partners and manager of Onex Partners funds.

Onex Corporation’s portion of the total equity investment was approximately $345 million or US $265 million as a Limited Partner in Onex Partners V in connection with the acquisition of WestJet.

photo credit: WestJet

News Release

– The Onex Group Completes Acquisition of WestJet –

CALGARY, Alberta, TORONTO, Ontario, December 11, 2019 – Onex Corporation (“Onex”) (TSX: ONEX) and its affiliated funds (the “Onex Group”) and WestJet Airlines Ltd. (“WestJet”)(TSX: WJA) today announced they have completed their transaction (the “Arrangement”) valued at approximately $5 billion including assumed debt. The closing comes following the receipt of the final regulatory approval by the Canadian Transportation Agency of its determination under the Canada Transportation Act.

Pursuant to the Arrangement, shareholders of WestJet are entitled to receive $31.00 in cash for each share held at the effective time of the Arrangement. A form of letter of transmittal pursuant to which registered shareholders of WestJet can submit their share certificates in order to receive the cash consideration under the Arrangement is being mailed to all registered shareholders. A copy of the letter of transmittal has been filed on WestJet’s profile at www.sedar.com and is being posted on WestJet’s website. Shareholders of WestJet who hold their shares through a broker are not required to submit a letter of transmittal; rather they will receive the cash consideration through their brokerage account.

The WestJet common shares will be delisted from the Toronto Stock Exchange within a few trading days. Due to closing of the Arrangement having occurred before December 18, 2019, the former public shareholders of WestJet will not receive the previously declared quarterly dividend to be paid on December 31, 2019.

Onex’ portion of the total equity investment was approximately $345 million (US$265 million) as a Limited Partner in Onex Partners V. Further terms of the transaction are not being disclosed.

About Onex

Founded in 1984 and headquartered in Canada, Onex invests and manages capital on behalf of its shareholders, institutional investors and high net worth clients from around the world. Onex’ platforms include: Onex Partners, private equity funds focused on larger opportunities in North America and Europe; ONCAP, private equity funds focused on middle market and smaller opportunities in North America; Onex Credit, which manages primarily non-investment grade debt through collateralized loan obligations, private debt and other credit strategies; and Gluskin Sheff’s actively managed public equity and public credit funds. In total, Onex has approximately US$38 billion of assets under management, of which approximately US$7.0 billion is its own shareholder capital. With offices in Toronto, New York, New Jersey and London, Onex and its experienced management teams are collectively the largest investors across Onex’ platforms.

The Onex Partners and ONCAP businesses have assets of US$38 billion, generate annual revenues of US$28 billion and employ approximately 157,000 people worldwide. Onex shares trade on the Toronto Stock Exchange under the stock symbol ONEX. For more information on Onex, visit its website at www.onex.com. Onex’ security filings can also be accessed at www.sedar.com.

About WestJet

The WestJet Group of Companies including regional airlines, WestJet Encore and WestJet Link, and ultra-low-cost carrier Swoop, offer scheduled service to more than 100 destinations in North America, Central America, the Caribbean and Europe and to more than 175 destinations in over 20 countries through our airline partnerships. WestJet Vacations offers affordable, flexible vacations to more than 60 destinations and the choice of more than 800 hotels, resorts, condos and villas. Members of the WestJet Rewards program earn WestJet dollars on flights, vacation packages and more. Members use WestJet dollars towards the purchase of flights and vacations packages to any WestJet destination with no blackout periods and have access to Member Exclusive fares offering deals to WestJet destinations throughout our network and those of our partner airlines.
WestJet is proud to be recognized for three consecutive years as Best Airline in Canada (2017-19) and awarded among travellers’ favourite Mid-Sized Airlines in North America (2019). From 2017-2018, WestJet was also awarded among travellers’ favorite Mid-Sized and Low-Cost Airlines in North America. The airline was also recognized among the Economy Class winners in North America, 2018. All awards are based on authentic reviews from the travelling public on TripAdvisor, the world’s largest travel site. We are one of very few airlines globally that does not commercially overbook. For more information about everything WestJet, please visit westjet.com.

Recent recognition includes:
2019/2018/2017 Best Airline in Canada (TripAdvisor Travellers’ Choice awards for Airlines)
2019 Winner Among Mid-Sized Airlines in North America (TripAdvisor Travellers’ Choice awards for Airlines)
2018/2017 Winner Among Mid-Sized and Low Cost Airlines – North America (TripAdvisor Travellers’ Choice awards for Airlines)
2018 Winner – Economy, North America (TripAdvisor Travellers’ Choice awards for Airlines)
2018 Number-One-Ranked Airline Credit Card in Canada (Rewards Canada)
2018 North America’s Best Low-Cost Airline (Skytrax)
2018/2017/2016 Canada’s Most Trusted Airline (Gustavson School of Business at the University of Victoria)

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