Transat AT Inc. says it has reached a deal with Ottawa to borrow up to $700 million – money that will be used “to make Transat a solid and profitable company once again” – and to provide refunds to customers. Importantly, Transat says all travel agent commissions will also be protected. (See Refund Guide below).
The money will come through the federal government’s Large Employer Emergency Financing Facility, the same program used to help Air Canada. Transat said $390 million will be used to help support its business, while $310 million will be used to provide reimbursements to travellers.
“The agreement reached with the government of Canada provides us with an additional $700 million in liquidity, which is the amount we needed to move forward with confidence,” Transat chief executive Jean-Marc Eustache said.
The Quebec-based company says the agreement will allow it to offer refunds to travellers who were issued a travel credit due to COVID-19 for a trip scheduled to start on or after Feb. 1, 2020. This policy applies to flights and packages booked by April 29, 2021. Going forward, should Transat make changes to its flight program, affected customers would also be eligible for a refund.
“We’ve been impatiently waiting for this moment, and we know our customers have been, too,” said Transat COO Annick Guérard. “Now that a funding agreement has been reached and the eligibility criteria have been established by the Government of Canada, we are delighted to be able to provide our customers with this long-awaited aid.”
Parameters of the deal set by government authorities maintain that those who have a travel credit must submit their refund request to Transat by Aug. 26, 2021. Customers who originally booked with a travel agent or online travel agency are advised to contact them directly.
“Travel agents have shown unwavering resilience and support since the crisis began,” added Guérard. “That’s why we’re pleased to confirm that commissions earned by agents will not be recalled if their customers opt for a refund.”
Both customers and travel agents are invited to visit airtransat.com/refunds for more information and to learn about the refund eligibility criteria.
“Our strong balance sheet prior to the pandemic and the aggressive actions we have taken since have enabled us to weather this unprecedented crisis so far. With this support, we now look forward to resuming operations as soon as safe travel is possible and travel restrictions can be lifted,” added Eustache.
Transat has also agreed to restrictions on dividends, stock repurchases and executive compensation, as well as to maintain active employment at the level of Wednesday.
Transat has endured a tough year, suspending all flights following the federal government’s request in January to stop travel to Mexico and the Caribbean due to the pandemic.
Air Canada and Transat also announced earlier this month that the two Montreal-based companies had agreed to call off a deal that would have seen the country’s largest airline buy its smaller rival. Initiated two years ago, the takeover was priced at $720 million before shrinking to $190 million as COVID-19 pounded the transport sector, ultimately dying out on April 2.
REFUND GUIDE
• Who is eligible? – Customers include those who have a travel credit, departure scheduled for Feb. 1, 2020 or later, booking made before April 29, 2021, did not transfer their travel credit nor received transferred travel credit, did not submit a claim to insurance company and whose booking is not subject to an active chargeback claim or has not already been refunded by a credit card provider.
• How to request a refund – Submit requests via Transat’s online form as soon as possible. The form is available at https://www.airtransat.com/en-CA/refunds.
• How soon will refunds be processed? – Processing times may take up to three months due to the high volume of requests. Requests will be treated in the order in which they are received.
• When is the deadline? – Refund requests must be submitted using Transat’s online form by Aug. 26, 2021. Transat says customers who don’t submit their request by this time will not get a refund. It says their travel credit will remain on file and will be available when making a new booking.
• Booked by a travel agency – Clients who originally booked with a travel agency or third party are advised to contact them directly so they can submit the request on their behalf. If the travel agency can’t be reached or is closed, clients should fill out a refund analysis form and submit it by Aug. 26, 2021.
• Keeping the credit instead – No action is required for clients who want to keep their travel credit. The credit will remain on the file with the same conditions and will be available when making a new booking. Partial refunds cannot be requested because travel credit cannot be split up.