Travel company Transat AT Inc. says it has reached a deal with Ottawa to borrow up to $700 million.
The money will come through the federal government’s Large Employer Emergency Financing Facility, the same program used to help Air Canada.
Transat says $390 million will be used to help support its business, while $310 million will be used to provide reimbursements to travellers.
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 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.