Jet Metal Corp. and Canada Jetlines Ltd. are pleased to announce that Jim Scott, CEO of Jetlines and Mark Morabito, President & CEO of Jet Metal Corp. applauded the announcement by federal Transport Minister Marc Garneau that he has approved Jetlines’ request for exemption from current foreign ownership rules, which will allow the airline to access necessary capital in order to begin operations.
“Today’s announcement will pave the way for Canadian air travellers to soon have access to jet air service in both un-served and underserved markets throughout the country and all Canadians will benefit from the lower airfares provided by a ULCC,” stated Jim Scott. “This is a great news announcement that will also create thousands of jobs and help stimulate local economies in communities all across Canada. Once in operations Jetlines also intends to purchase new aircraft.”
On May 16 of this year, Jetlines and its strategic partner, Jet Metal, had applied directly to the Minister of Transport under subsection 62(1) of the Canada Transportation Act seeking to obtain a license for Jetlines at a foreign ownership threshold of up to 49 per cent. The current rules set a foreign ownership level to a maximum of 25 per cent. Under law, the Minister may grant an exemption, if the government believes it is in the “public interest” to do so.
“The Minister’s announcement is further confirmation that there is a lack of access to risk capital in Canada, and that foreign investment is critical to meeting consumer demand in the airline sector through increased competition,” said Mark Morabito. “With the Minister’s announcement today, we now have the opportunity to offer new options for the more than ten million Canadians who are not choosing to fly in Canada, and to repatriate the five million annual flights Canadians have been accessing via U.S. airports, and bring that business back to Canada.”
While approving the exemption for Jetlines, the Minister has indicated he is pursuing a permanent policy change through the legislative process, in order to provide greater opportunities for investment and more options for Canadian air travellers.
Jetlines and Jet Metal will now be working to satisfy the final conditions associated with the closing of the business combination transaction between the parties (the “Transaction”). Additional information regarding the process for the closing of the Transaction will be provided in a subsequent news release from the parties.