MONTREAL — The outside date for finalizing Air Canada’s proposed acquisition of Transat has now passed but the deal is still on track pending approval from the European Commission.

Transat issued a status update this morning.

As reported on Feb. 11, the federal government has approved the Air Canada – Transat deal, however the companies are still waiting to hear from the European Commission. Originally expected to deliver a decision by December 2020, the EC now says its decision will be made in the first half of 2021.

The outside date for the consummation of the deal was Feb. 15, 2021. Now that the outside date has passed, and while still waiting to hear the EC’s decision, Air Canada and Transat are entitled, at any time, to terminate their deal upon notice to the other party.

“Transat and Air Canada are continuing their discussions regarding potential amendments to the arrangement agreement that may be required. In the context of such discussions, Transat has been informed by Air Canada that Air Canada will not agree to an extension of the current outside date. In such case, even if the arrangement agreement is amended, Air Canada and Transat would retain the ability to terminate the agreement at any time. There can be no assurance that an agreement on any such amendments will be reached, or that Air Canada or Transat will not terminate the arrangement agreement if the relevant circumstances so warrant,” says Transat.

However as long as neither company terminates or amends the deal, it remains in effect in accordance with all of its terms.