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Transat A.T. Inc. Completes its Injection of More than $40 Million in Additional Cash Previously Announced
Transat A.T. Inc., a leader in the organization, marketing, and distribution of holiday travel, announces that it has completed the closing of the agreements with certain shareholders and with its lenders previously announced in order to increase its available cash by more than $40 million.
The Company has closed yesterday a $20 million investment by two of its largest shareholders, CDP Capital d'Amérique and Solidarity Fund QFC, under which each of those partners has invested $10 million in non-convertible debentures in the Company and its wholly-owned subsidiary Air Transat.
Management of the Company and affiliates thereof have also invested $1,865,000 in a similar form. The Debentures pay a 6% annual interest and feature a premium which, at maturity, provides an internal rate of return of 15%. The debentures mature in seven years, but can be redeemed at the option of the Company after three years and upon certain stated events.
The issue of non-convertible debentures is accompanied by warrants allowing for the subscription of 1,421,225 common shares over the next five years at a price of $6.75 a share.
CDP Capital d'Amérique currently holds 3,690,575 common shares of the Company representing approximately 11.38% of the currently outstanding common shares, or 13.12% assuming only the exercise of the warrants held by CDP Capital d'Amérique. Solidarity Fund QFC currently holds 3 930 086 common shares of the Company representing approximately 12.12% of the currently outstanding common shares, or 13.84% assuming only the exercise of the warrants held by Solidarity Fund QFC.
The Debentures and warrants have been acquired by each of CDP Capital d'Amérique and Solidarity Fund QFC under the terms of a private placement for investment purposes. Moreover, the Company has renewed its revolving credit facility that was to expire in February 2002 for an additional year and has concurrently obtained the release of collateral that will increase the Company's available cash by $20 million.
Transat A.T. Inc., with its head office in Montreal, is an integrated company specializing in the organization, marketing, and distribution of holiday travel. The core of its business consists of tour operators in Canada and France. Transat is also involved in air transportation, hotel management, and value-added services offered at travel destinations, as well as in distribution through both travel agency networks and e-commerce initiatives. Transat A.T. Inc. is a public corporation listed on the Toronto Stock Exchange (TSE:TRZ). In fiscal 2000 Transat recorded revenues of $1.9 billion.