Air Canada gets $831m bailout deal

Victor T.K. Li of Hong Kong's Cheung Kong (Holdings) Ltd. is to invest C$650 million ($491 million) in equity while another C$450 million ($340 million) from a rights offering is to be backed by Deutsche Bank, the airline said in a statement late Saturday.

Li's investment under the name Trinity Time Investments represents 31 percent of the common equity in the restructured airline.

Li is a Canadian citizen based in Hong Kong whose family holds controlling interests in Cheung Kong as well as such other widely held companies as Hutchison Whampoa Limited, Hongkong Electric Holdings Limited, and Husky Energy, a Canadian oil producer and gasoline marketer.

The Cheung Kong Group ranks among the top 100 corporations in the world, with businesses in close to 40 countries and over 165,000 employees, the Air Canada statement said.

The airline's board of directors approved the deal over the weekend.

"Given the success of Victor Li in his global business endeavors, we look forward to the opportunity to benefit from his participation in fully realizing Air Canada's true potential," chief executive Robert Milton said in a statement.

Li was chosen as equity partner over Cerberus Capital Management L.P. of New York, an asset management firm with Canadian interests.

Montreal-based Air Canada was granted bankruptcy protection April 1 to restructure itself as a leaner operation, with fewer aircraft and thousands fewer workers.

The airline's creditors will be able to acquire new shares on the same economic terms as Trinity, the statement said. Deutsche Bank is to purchase rights not bought by creditors to a ceiling of 15 percent.