The untold story of why AC was forced into buying CP will probably remain untold for quite sometime. Onex clearly intended to shred both companies to their cores and make a profitable business out of it. Doing so assumed certain levels of control that (as AC successfully claimed in court) was not permissable by law, and Onex was forced to withdraw their bid. AC had made regular offers for CP assets prior to the Onex bid, but any significant bids would of required a relaxation of the equivalent of "anti-trust" rules embodied in the Air Transport Act. Once that was done, Onex made their bid... In a manner acceptable to CP's board and majority owners. I guess AC felt that it had to continue to match an offer on the table for CP, and probably was 'persuaded' by the Federal Government to not allow CP to go under. If that was the case, it's odd that 'tell it like it is' Milton hasn't even hinted at this. Though there were hints that the Feds were going to offer significant concessions to AC if they took over CP's assets. AC's share price hit $20 (from $6.25 before the start) on that sentiment. The concessions turned out more to be constrictions, the economy soured, AC had some serious labour issues, and AC's share price plunged below $5. I'm still hoping some business editors from The Financial Post or the Globe and Mail will compile the "untold" story of the fiasco. It'd make great reading.\ Matthew > -----Original Message----- > From: The Airline List [mailto:AIRLINE@LISTSERV.CUNY.EDU] On > Behalf Of Mike Gammon > Sent: February 9, 2002 7:08 AM > To: AIRLINE@LISTSERV.CUNY.EDU > Subject: Re: Air Canada posts record $1.25 billion loss for 2001 > > > A couple of theories: > > 1) debt (from the CP takeover) > 2) they inherited a mixed-bag fleet. For example, the > 767-300s: several marques (333s from AC, 375 from CP, and > several acquired on the second hand market, eg ex-Asiana) with > a mix of engines (P&W and GE) and non-compatible interior > layouts (galley eq't, entertainment systems, etc; a friend > recently flew back from Oz in a 767-300 for part of the trip > and they couldn't use the entertainment system: the wrong > headset type had been loaded on board). The same is true > with the 747s: Air Canada had 3 747-433 Combis, and CP had 4 > 747-475s. AC = P&W, CP = GE. The same is also true in the > regional market where the inherited F28s compared to AC > Regionals 146s. etc. > > I've never heard of mergers that didn't result in a mountain > of debt and incompatibilities in equipment, management style, > procedures, etc etc. > > The reason QF no doubt came ahead is that they let AN just > die a natural death and suddenly found themselves with 100% > of the full-service market share at no cost. Air Canada > PURCHASED that extra market share and acquired debt and a > mountain of trouble in the process. > > And I'll remind you that all this was spurred on by a hostile > takeover attempt from Onex. I do believe Air Canada's prior > strategy was to use its superior financial health (at the > time) to squeeze CP into a natural death. The Onex fiasco > sort of forced their hand into doing something more drastic, > to avoid takeover by Onex. Whether that takeover would have > been a disaster or it just had to do with Milton's ego we'll > never know. Gerry Schwartz of Onex now believes that God > handed him a big favour by having his AC/CP takeover fail as > he, instead of Milton, would have been trying to sort the > mess out. The only difference to the flying public would > have been membership in Oneworld rather than Star Alliance. > > Mike Gammon > > ----- Original Message ----- > From: "Dave Pethick" <thedarkstar2@hotmail.com> > To: <AIRLINE@LISTSERV.CUNY.EDU> > Sent: Saturday, February 09, 2002 2:59 AM > Subject: Re: Air Canada posts record $1.25 billion loss for 2001 > > > > The obvious interesting comparison to the AC situation is QF in = > > Australia. While QF may also be losing money on > international routes > > at = the moment - they are sure raking it in domestically after the > > collapse = of AN. QF is currently the only full service airline in > > Australia. There = are other no frills airlines similar to > what's on > > offer in Canada. > > > > So if QF can make record profits on a domestic market the size of = > > Australia, then I think AC must surely be able to do > likewise or at = > > least break even in the larger Canadian market. What are > they doing = > > wrong ?? Cant still be due to paying to much for Canadian > Airlines = > > surely.? Any ideas ?? > > > > Maybe they should practice their skills while playing AIRLINE. :-) > > > > > > > > > > > > > > ----- Original Message -----=20 > > From: "Carolyn Stoughton" <carlyn@ont.com> > > To: <AIRLINE@LISTSERV.CUNY.EDU> > > Sent: Friday, February 08, 2002 12:56 PM > > Subject: Re: Air Canada posts record $1.25 billion loss for 2001 > > > > > > > The media air scare would effect all including a monopoly, along > > > with exorbitant fuel costs. Regardless, you're right! > It would be > > > = > > interesting > > > to see accurate AC financial records. That's a crowd of cash! =20 > > > ----- Original Message ----- > > > From: Alex Nieves <alexnieves1@juno.com> > > > To: <AIRLINE@LISTSERV.CUNY.EDU> > > > Sent: Thursday, February 07, 2002 1:59 PM > > > Subject: Re: Air Canada posts record $1.25 billion loss for 2001 > > >=20 > > >=20 > > > > Air Canada's managers must be terrible at running an > airline! If > > > > = > > you > > > > have almost a monopoly in a market (AC's market is > full-service, > > > > coast-to-coast airline just in case y'all were thinking Westjet > > > > and = > > Air > > > > Transat, etc), how can you possibly lose so much money? > Did they > > > > do = > > that > > > > bad on international routes? Or was traffic to and from the US > > > > the = > > major > > > > problem for AC? If anyone can shed some light into this so I > > > > don't = > > stay > > > > in the dark, i'd appreciate it. That amount of loss > just leaves > > > > me wondering! > > > > > > > > Alex Nieves > > > > > > > > On Thu, 7 Feb 2002 12:32:57 -0600 Roger James > <ejames@escape.ca> = > > writes: > > > > > Air Canada posts record $1.25 billion loss for 2001 > Last Updated > > > > > Thu, 07 Feb 2002 13:07:34 > > > > > > > > > > MONTREAL - Air Canada said Thursday it lost a record $1.25 > > > > > billion last year, its worst financial performance since 1992. > > > > > Canada's national carrier reported it lost $10.43 a > share for = > > 2001. > > > > > Air > > > > > Canada's fourth quarter and full year performance reflect the > > > > > extraordinarily difficult environment in which we and other > > > > > comparable North American carriers were operating," chief > > > > > executive Robert Milton said > > > > > in a news release. Financial analysts say while the > airline has > > > > > benefited > > > > > from cost-cutting measures, they aren't enough to > offset a lack of > > > > > passengers. "Like the rest of the international > airline industry, > > > > > we > > > > > experienced an unprecedented decline in business > travel due to the > > > > > economic > > > > > downturn along with high fuel prices. Then came the > devastating > > > > > impact of > > > > > Sept. 11," read Milton's release. Air Canada's > yearly revenues = > > fell > > > > > 11 > > > > > percent, from $10.8 billion to $9.6 billion. > > > > > > > > > > Written by CBC News Online staff > > > > > > > > > > > > > > > > > > > > The owner of Roger's Trinbago Site: > > > > > Roj (Roger James) > > > > > > > > > > *************************************************** > > > > > Trinbago site: http://www.tntisland.com > > > > > ICQ: ICQ # 15836110 > > > > > ICQ Pager: mailto:15836110@pager.icq.com > > > > > escape email #!1 mailto:ejames@escape.ca > > > > > yahoo email #2: mailto:triniroj@yahoo.com > > > > > Yahoo Pager: triniroj > > > > > Caribbean Brass & Soca Connection Group on Yahoo: > > > > > http://groups.yahoo.com/group/caribsocabrass > > > > > Caribbean Brass & Soca Connection Club Website > > > > > http://www.tntisland.com/caribbeansocabrassconnection/ > > > > > ******************************************************* > > > > > Steel Expressions Orch > > > > > http://www.escape.ca/~ejames/se/ > > > > > email #1: mailto:steelexpressions@yahoo.com > > > > > email #2: mailto:steelexpressions@home.com > > > > > ******************************************************* > > > > > The Trinbago Site of the Week: > > > > > (Revellers Mas Band) http://www.revellers.com/ > > > > > (Trini Revellers Mas Band) > > > > > courtesy of Roj Trinbago Website & TnT Web Directory Roj's > > > > > Trinbago Website: http://www.tntisland.com TnT Web Directory: > > > > > http://195.224.187.36/ > > > > > ********************************************************* > > > > > > > > > > > > > > > > > > > > > Alex > > > > > > >=20 >