The Globe and Mail reports in its Friday edition that Transat AT has agreed to a $520-million takeover by Air Canada, but one major shareholder said the offer is too low and urged rival bidders to renew their efforts. The Globe's Eric Atkins writes that the all-cash deal, worth $13 for each Transat share, comes after 30 days of exclusive talks between the two airlines and is not expected to be completed until next year given the number of approvals needed. Large Transat shareholders criticized the offer after it was proposed on May 16, saying it undervalued the company and was ill-timed. Support from three large Transat investors based in Quebec is key to the deal's approval. Letko, Brosseau & Associates, which owns 17 per cent of Transat, is on record opposing the deal. Amar Pandya at PenderFund urged other suitors, Montreal real estate developer Group Mach and FNC Capital of Montreal, to work with Air Transat's board. "The Air Canada offer doesn't fully reflect the value of Transat," Mr. Pandya said by phone. "We think this is Air Canada negotiating hard." Group Mach recently offered $14 a share. Mach's Alfred Bugge said he cannot understand why the Transat board would recommend the lower Air Canada offer.
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