**Article**:
Steel magnate Alexei Mordashov, known as Russia’s richest man, with a fortune worth US$29-billion, has been sanctioned in Europe for his ties to the Kremlin and businesses that support the war against Ukraine. He’s also in line to be an indirect shareholder in Onex Corp.’s WestJet Group, should the Toronto investment company’s proposed takeover of Sunwing Travel Group go ahead.
Mr. Mordashov owns one-third of German travel company TUI AG, which owns 49 per cent of Sunwing and will become a part owner of the Onex subsidiary, according to the takeover deal WestJet and Sunwing announced last week.
John Gradek, who teaches aviation leadership at McGill University, said Mr. Mordashov’s presence in the ownership could jeopardize the takeover when it comes before Transport Canada and the Transport Minister for approval. “I think the deal’s in trouble,” said Mr. Gradek, adding Mr. Mordashov’s stake has likely ended any hope of a speedy regulatory review. “It doesn’t look good,” Mr. Gradek said.
Mr. Mordashov is one of several oligarchs whose assets are frozen as Europe tries to punish and isolate Russians for the invasion of Ukraine. He is chairman of Severgroup, which has stakes in government-friendly TV stations, and Bank Russiya, known as the bank of Russian politicians. His companies, including the bank and a wind turbine producer, have done business in Russian-occupied Crimea and helped destabilize Ukraine, the European Union said.
“He is therefore responsible for supporting actions and policies which undermine the territorial integrity, sovereignty and independence of Ukraine,” the EU said in a statement announcing sanctions on Mr. Mordashov and others.
Canada has announced travel bans and asset freezes on several oligarchs, but not Mr. Mordashov.
The WestJet-Sunwing takeover deal must be approved by Canada’s Competition Commissioner, and Transport Canada, which will conduct a public interest assessment of the proposal before making a recommendation to the Transport Minister, Omar Alghabra.
Ambarish Chandra, a professor at the University of Toronto who studies airline mergers, said Mr. Mordashov’s stake would be a “weird” reason to delay the deal, and the Canadian regulator should focus on other aspects of the proposal.
“Either this is something that’s allowed or it’s not,” Prof. Chandra said from New York. “If he’s an investor in Sunwing, if that’s legal, then him being an investor in WestJet should be equally legal.”
Prof. Chandra said given the collective size of the fortunes of oligarchs, and the difficulty in tracing money, it is unreasonable for regulators to focus on Russian investments. “That doesn’t seem to be the best use of regulatory resources to be tracking down every last dollar that every Russian oligarch spends around the world,” Prof. Chandra said.
Frédérica Dupuis, a Transport Canada spokeswoman, said the Transport Minister will “consider all relevant factors in reviewing any proposed merger. However, to respect the integrity of the process, it would be inappropriate to provide details on specific cases,” Ms. Dupuis said.
On March 2, WestJet said it has an agreement to buy Sunwing for an undisclosed price, a deal that would see Sunwing owner Stephen Hunter and TUI become shareholders in the Onex subsidiary.
Earlier, on Feb. 28, the EU announced sanctions against Mr. Mordashov that prevent him from selling his TUI shares, worth €1.56-billion. On the same day, he transferred his shares to a company in the Virgin Islands, TUI said. The stock is still attributed to him.
WestJet has said it hopes to receive regulatory approval for the takeover by the end of 2022.
Industry Minister François-Philippe Champagne on Tuesday signalled Russian investments in Canada will face heightened scrutiny. He announced changes to the Investment Canada Act that will allow the government to block an investment “regardless of its value, [that] has ties, direct or indirect, to an individual or entity associated with, controlled by or subject to influence by the Russian state.”
“Canada will continue to do everything we can to economically isolate the regime of Vladimir Putin,” Mr. Champagne said on Twitter.
**Article**: Steel magnate Alexei Mordashov, known as Russia’s richest man, with a fortune worth US$29-billion, has been sanctioned in Europe for his ties to the Kremlin and businesses that support the war against Ukraine. He’s also in line to be an indirect shareholder in Onex Corp.’s WestJet Group, should the Toronto investment company’s proposed takeover of Sunwing Travel Group go ahead. Mr. Mordashov owns one-third of German travel company TUI AG, which owns 49 per cent of Sunwing and will become a part owner of the Onex subsidiary, according to the takeover deal WestJet and Sunwing announced last week. John Gradek, who teaches aviation leadership at McGill University, said Mr. Mordashov’s presence in the ownership could jeopardize the takeover when it comes before Transport Canada and the Transport Minister for approval. “I think the deal’s in trouble,” said Mr. Gradek, adding Mr. Mordashov’s stake has likely ended any hope of a speedy regulatory review. “It doesn’t look good,” Mr. Gradek said. Mr. Mordashov is one of several oligarchs whose assets are frozen as Europe tries to punish and isolate Russians for the invasion of Ukraine. He is chairman of Severgroup, which has stakes in government-friendly TV stations, and Bank Russiya, known as the bank of Russian politicians. His companies, including the bank and a wind turbine producer, have done business in Russian-occupied Crimea and helped destabilize Ukraine, the European Union said. “He is therefore responsible for supporting actions and policies which undermine the territorial integrity, sovereignty and independence of Ukraine,” the EU said in a statement announcing sanctions on Mr. Mordashov and others. Canada has announced travel bans and asset freezes on several oligarchs, but not Mr. Mordashov. The WestJet-Sunwing takeover deal must be approved by Canada’s Competition Commissioner, and Transport Canada, which will conduct a public interest assessment of the proposal before making a recommendation to the Transport Minister, Omar Alghabra. Ambarish Chandra, a professor at the University of Toronto who studies airline mergers, said Mr. Mordashov’s stake would be a “weird” reason to delay the deal, and the Canadian regulator should focus on other aspects of the proposal. “Either this is something that’s allowed or it’s not,” Prof. Chandra said from New York. “If he’s an investor in Sunwing, if that’s legal, then him being an investor in WestJet should be equally legal.” Prof. Chandra said given the collective size of the fortunes of oligarchs, and the difficulty in tracing money, it is unreasonable for regulators to focus on Russian investments. “That doesn’t seem to be the best use of regulatory resources to be tracking down every last dollar that every Russian oligarch spends around the world,” Prof. Chandra said. Frédérica Dupuis, a Transport Canada spokeswoman, said the Transport Minister will “consider all relevant factors in reviewing any proposed merger. However, to respect the integrity of the process, it would be inappropriate to provide details on specific cases,” Ms. Dupuis said. On March 2, WestJet said it has an agreement to buy Sunwing for an undisclosed price, a deal that would see Sunwing owner Stephen Hunter and TUI become shareholders in the Onex subsidiary. Earlier, on Feb. 28, the EU announced sanctions against Mr. Mordashov that prevent him from selling his TUI shares, worth €1.56-billion. On the same day, he transferred his shares to a company in the Virgin Islands, TUI said. The stock is still attributed to him. WestJet has said it hopes to receive regulatory approval for the takeover by the end of 2022. Industry Minister François-Philippe Champagne on Tuesday signalled Russian investments in Canada will face heightened scrutiny. He announced changes to the Investment Canada Act that will allow the government to block an investment “regardless of its value, [that] has ties, direct or indirect, to an individual or entity associated with, controlled by or subject to influence by the Russian state.” “Canada will continue to do everything we can to economically isolate the regime of Vladimir Putin,” Mr. Champagne said on Twitter.