WestJet said in a statement released shortly after 6 p.m. ET on Tuesday that shareholders “overwhelmingly voted” to approve the Onex offer. Of the votes cast at Tuesday’s meeting, 92.53 per cent were in favour of the deal.
WestJet’s board of directors had unanimously recommended that shareholders approve the agreement. The deal required the approval of at least 66.67 per cent of shareholders.
Onex will acquire outstanding WestJet shares for $31, a 67 per cent premium on the closing price of the airline’s shares on May 10, the last trading day before the blockbuster deal was announced.
“Receiving this support is an important step on our path to closing the transaction, and we continue to engage with the necessary authorities on the remaining approvals,” WestJet’s chief executive Ed Sims said in a statement.
Shares of the Calgary-based airline closed at $30.69 on Tuesday, flat compared to the close a day earlier.
Canada’s Minister of Transport has approved the transaction, but it still requires several regulatory approvals, including from the Canadian Competition Bureau, the Canadian Transportation Agency’s Canadian status determination, as well as approvals related to antitrust laws from the U.S. Federal Trade Commission and the Antitrust Division of the Department of Justice.
“Assuming the timely receipt of these approvals, the transaction is expected to close in the latter part of this year,” WestJet spokesperson Lauren Stewart said in an emailed statement.
According to a management information circular released in June, Onex first contacted WestJet about investing in the company in July 2016, when the airline was headed by now-former chief executive Gregg Saretsky. Informal discussions were held in October, and again in January 2017. The possibility of Onex acquiring WestJet was discussed in April and November of 2017, but no formal offer or proposal was made at that time.
Discussions continued in January and February 2018. By March 12, Onex gave WestJet a non-binding proposal for the acquisition of the airline. The next day, WestJet’s Board of Directors was informed of the offer, and determined Onex’s proposal warranted further consideration. A special committee formed to consider the offer “unanimously determined that the arrangement is in the best interests of the corporation and is fair to shareholders.”