The Globe and Mail reports in its Wednesday edition for workers, corporate takeovers too often result in the hunt for so-called efficiencies which negatively affect workers.
Guest columnist Jerry Dias writes that there are times, however, when finding reason to support a corporate merger is necessary.
The current Air Canada $520-million purchase of Transat A.T., which includes Air Transat plus resort and hotel operations, is a case in point. Air Canada is committed to continue operating Air Transat, as it serves an important part of the market, and maintaining its corporate presence in Montreal. Air Canada has expanded its international capacity by 50 per cent over the past decade, but relatively less presence in the charter airline sector. Adding Transat, which flies almost exclusively internationally, will help strengthen the company, especially in the face of growing megacapacity international carriers.
As hedge funds typically do, they are much more likely to bust up the company and sell off parts of the business to maximize their profits. Air Canada, however, has a vested interest in keeping Transat going. Transat expands its offerings, and that helps the company. A strong Air Canada is good for workers.
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