Airline Industry Acquisition Financial Model

Description
Product Description: Air Canada Financial Model is a financial model of Air Canada acquisition of Transat AT Inc. in the North American Airlines industry during a global virus crisis, COVID-19, that is ideal for investment banking, equity research, Airlines and Air Transportation professionals and valuation experts. The model includes the following features:
- A 3-statement financial model of Air Canada operation post acquisition of Transat including: revenue schedule, cost schedule, working capital schedule, non-working capital items schedule, depreciation and amortization schedule, tax schedule (Canadian tax standards), debt and interest schedule, shareholder’s equity schedule, and covenants and credit statistics spanning across earnings quality, cash flow quality, operating efficiency, balance sheet quality and valuation risk metrics, income statement, cash flow statement and balance sheet for a six year forecast period.
- Historical financial statements for the period of four years, company specific operating metrics, covenants and credit statistics including earnings quality, cash flow quality, operating efficiency, balance sheet quality and valuation risk metrics for both the Acquirer, Air Canada, and the Target, Transat.
- Determination and proof of the stage of corporate life cycle for both the Acquirer and the Target. (i.e. which stage of corporate life cycle each company is operating at.)
- Performance of the Acquirer and the Target historical share prices in the periods leading up to the acquisition announcement, prior to the pandemic and during the pandemic.
- Calculation of Basic and Diluted shares outstanding for both the Acquirer and the Target.
- Critical Airline industry operating and profitability metrics such as Revenue passenger miles (“RPM”), Available seat miles (“ASM”), Passenger revenue per RPM ("Yield"), Passenger revenue per ASM ("PRASM"), Operating revenue per ASM, Operating expense per ASM ("CASM"), Adjusted CASM, Adjusted EBITDA, Adjusted EBITDAR, Adjusted EBIT, Adjusted net income and Non-IFRS measures among others.
- Historical ratings of Air Canada foreign and domestic bonds.
- Mergers and Acquisition model and accretion and dilution analysis of the deal to Air Canada as of June 27, 2019, just prior to the deal announcement, as well as May 3rd, 2020, in the midst of a global virus crisis and closer to the deal expected close date.
- Sources and uses of funds model, purchase price allocation and calculation of goodwill in the transaction given the deal tearsheet information.
- Sensitivity analysis of value creation opportunities for Air Canada and Transat shareholders as of June 27, 2019 and May 2020 given a range of forward FY1 and FY2 EV/EBITDAR multiples.
- Impact of Target acquisition on the Acquirer as of June 27, 2019 and as of May 2020 and the financial implications of a global pandemic on the deal, the Acquirer and the Target.
- Contribution analysis of the deal as of June 27, 2019 and May 3, 2020.
- Examination of legal clauses such as Material Adverse Effect in the Arrangement Agreement and determination of the possibility of reverse termination.
- Valuation of Air Canada distressed equity based on intrinsic valuation and discounted cash flow approach during a global virus crisis, COVID-19.
- Valuation of the combined company, Air Canada distressed equity based on the option valuation of distressed equity and contingent claim valuation approach during a global virus crisis, COVID-19.
- Sensitivity analysis of intrinsic valuation as a function of percentage drop in the revenue and cost drivers in 2020 and 2021 due to the spread of COVID-19 and the inability of the Airlines to fly or operate at 100% capacity.
- Valuation of the Acquirer and the Target, based on relative valuation and comparable analysis of peer group companies.
- Calculation and quantification of risk measures for purposes of valuation including beta, cost of equity and cost of capital for the Acquirer and the Target.
- Operating, valuation, profitability and performance charts of the Acquirer and the Target’s operations.
- A summary dashboard of combined company financial report and credit statistics, market data, sources and uses of funds, accretion and dilution analysis, value creation opportunities for both parties, key financial metrics, comps, valuation and its sensitivities to different inputs and other statistics .
- The tabs of the models are: Cover, Summary, Assumptions, Sources & Uses, Historicals, M&A Model – June 27, M&A Model - May, Pro Forma Model and Valuation, Other and Notes.
- A comprehensive report of the transaction, financial performance and forecasts of the companies pre and post transaction, corporate governance issues, valuations and sensitivities as of May 04, 2020 is included with the package.