Air Canada understands that Onex is soliciting proxies for the Air Canada Shareholders` Meeting on the basis that a vote for Onex is a vote to keep the process open for increased shareholder value. Air Canada believes that this is misleading and that a vote for Onex at next week`s meeting will be very damaging to Air Canada and its shareholders.
The Onex Amendments to the Articles operate like an open-ended option in Onex`s favour. These amendments can only be used by AirCo, Onex`s vehicle, and can be used at any time.
Onex is asking shareholders to take radical steps (make fundamental changes to Air Canada`s share capital and contingently replace the entire Air Canada Board) and to cast their votes into an unknown outcome on the basis of a vague suggestion that it might increase its bid, without any indication of when its bid would be increased or whether it would represent greater value to Air Canada`s shareholders.
It would be damaging to the value and market price of Air Canada shares for Air Canada to operate in a corporate “vacuum” should the Onex resolutions be approved while the Onex bid is considered inadequate by the Air Canada Board of Directors. Onex would have little incentive to further enhance its bid.
Voting “no” to the Onex resolutions will not preclude anyone, including Onex, from making a higher bid at any time. If Onex is defeated on November 8, it can requisition another meeting at any time or await an amendment to the ten per cent rule to achieve what it is asking shareholders to vote on now.
“A vote for the Onex proposals is a one-way ticket to uncertainty,” said President and Chief Executive Officer, Robert A. Milton. “The Onex Amendments, if approved by the shareholders, would permit Onex—and only Onex—to acquire Air Canada. No other bidder can use the Onex Amendments as proposed.”
Shareholders who require new proxy materials or additional information should contact Shareholder Communications Canada at 1-800-890-1037.