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Ottawa Sells Air Canada Stake

The Canadian government has reportedly sold its approximately 6% stake in Air Canada (TSX: AC), according to multiple sources, marking the conclusion of its direct ownership in the country’s largest airline. The stake was acquired in April 2021 as part of a $5.9 billion bailout package designed to stabilize Air Canada during the COVID-19 pandemic, but its sale now raises questions about the government’s financial strategy and its handling of corporate bailouts.

During the height of the pandemic, Air Canada faced staggering financial losses due to border closures and travel restrictions. To prevent the collapse of the airline, which is a cornerstone of Canada’s transportation infrastructure, the federal government stepped in with a $5.9 billion aid package. The agreement included a $500 million equity investment, which translated to a 6% ownership stake, with shares purchased at $23.18 each.

You can read more on the matter here.

What’s going on?

• Canada Considers Shutting Off Uranium And Oil Exports To U.S. (theDeepDive)

• Federal government orders end to Canada Post strike while commission tries to reach new contract (TS)

• Trudeau’s Outreach to Carney Raises Questions About Freeland’s Position (theDeepDive)

• Canada considers export tax on major commodities oil, uranium and potash if Trump imposes 25% tariff (Globe)

• Satellite Data Debunks Iranian Ship Claims While Real Drone Threat Nabbed at US Base (theDeepDive)

• US lawmakers tell Apple, Google to be ready to remove TikTok from app stores on Jan. 19 (Reuters)

• Former TD Bank Employee Charged in Colombia Money Laundering Scheme (theDeepDive)

• Amazon, Meta to contribute US$1 million each to Trump’s inauguration fund (BNN)

• YouTube Could Inherit 30% of TikTok Creators Amid Ban Threat (theDeepDive)

• Nancy Pelosi hospitalized after injury in Luxembourg (CNBC)

What’s the latest?

• Broadcom: Broadcom's stock surged over 21%, pushing its market cap past $1 trillion, following fourth-quarter earnings that beat expectations and highlighted 220% annual AI revenue growth to $12.2 billion. Quarterly revenue rose 51% year-over-year to $14.05 billion, with semiconductor solutions generating $8.23 billion, up 12%. Net income increased 23% to $4.32 billion, or 90 cents per share.

• Musk: The SEC issued a settlement demand to Elon Musk over potential securities fraud related to his 2022 Twitter share purchases and sales, with allegations tied to his leveraged buyout of the platform. Musk's attorney accused the SEC of harassment, citing over six years of investigations, including new scrutiny into Neuralink. The SEC’s investigation follows prior cases, including a 2018 settlement where Musk and Tesla paid $20 million each over misleading statements about taking Tesla private. Separately, the Oklahoma Firefighters Pension Fund is suing Musk for allegedly concealing his Twitter investments, disadvantaging other shareholders.

• Moldova: Moldova's parliament approved a 60-day state of emergency as the country faces an imminent halt in Russian gas flows after the Russia-Ukraine transit deal expires on Dec. 31. The cessation could disrupt Moldova's energy sector and lead to a humanitarian crisis in the Transnistrian region. Analysts warn the European Union may lose 15 billion cubic meters of annual gas supply, 5% of total imports, though alternative swaps with Azerbaijan are being explored.

• Trump’s Inauguration Fund: Amazon plans to donate $1 million to President-elect Donald Trump's inauguration fund and stream the event on Prime Video, a separate in-kind donation also valued at $1 million. Meta confirmed a similar $1 million donation, marking a shift in tech companies' relationships with Trump after prior tensions. Historically, Amazon donated $58,000 to Trump's 2017 inauguration, significantly less than its current pledge. Other tech giants like Google and Microsoft have also made varied contributions to past inaugurations, reflecting shifting corporate strategies.

• Air Canada: The Canadian federal government has sold its 6% stake in Air Canada, originally purchased in 2021 for $500 million as part of a $5.9 billion pandemic bailout. The decision comes amid speculation that Ottawa is seeking funds for increased spending, following recent budget announcements. Air Canada shares closed at $25.28 on the Toronto Stock Exchange.

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The stock market and stuff

• Amazon Autos Takes On Car Dealerships With A New Way To Buy Cars Online (theDeepDive)

• Broadcom soars to $1tn as chipmaker projects ‘massive’ AI growth (FT)

• ExxonMobil Doubles Down on Expansion… Or Maybe Not Really (theDeepDive)

In the juniors

• Jaguar Mining Sees Brazilian Government Attempt To Freeze $47.3 Million In Cash After Tailings Landslide (theDeepDive)

• G2 Goldfields To Transfer Non-core Assets To G3 Subsidiary In Advance Of Proposed Spinout (theDeepDive)

• Cytophage Enters Partnership To Launch Phage Clinical Treatment Program In Manitoba (theDeepDive)

• Bonterra Energy Guides To 14,700 BOE Per Day Of Production In 2025 (theDeepDive)

FULL DISCLOSURE: Temas Resources is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Temas Resources on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.