TORONTO (Reuters) - Shares of Air Canada's
Regulatory filings showed that a little over 19.1 million Chorus Aviation shares were unloaded on Tuesday. Fairfax, which owned nearly 16 percent of Chorus class B shares and about 11.6 percent of the firms class A shares, held a total of about 19.1 million shares, according to Thomson Reuters data.
Chorus confirmed in an email to Reuters that the insurance and investment company managed by well-known Canadian investor Prem Watsa had sold its stake in the company on Tuesday.
Fairfax could not be immediately reached for comment on the move and the timing of it.
The investment firm's move comes at a time when analysts expect a tougher and more competitive climate for the Canadian airline industry, as both WestJet and bigger rival Air Canada
Earlier this week, WestJet announced that Fort St John and Nanaimo in the province of British Columbia would be the first two cities served by its new low-cost carrier dubbed WestJet Encore. The new arm, which is set to begin operations in June, will largely serve smaller cities across Canada.
Chorus currently operates about 130 aircraft for Air Canada, the country's largest airline, under the Jazz logo. It typically flies to smaller destinations and to larger communities in off-peak hours throughout Canada and into the United States.
Shares in Chorus Aviation, which are still up more than 12 percent since the start of the year, were down 7.8 percent at C$4.32 in afternoon trading on Wednesday, after diving as low as C$3.77 amid heavy trading earlier in the day.
By 1430 ET (1930 GMT) on Wednesday, more than 1.6 million of Chorus's class B shares changed hands, roughly six times more than its prior 50-day average. Class A share volumes were double the 50-day average.
Fairfax sold all the shares at C$4.50 a share, pegging the value of the trade at about C$86 million ($85.8 million).
(Reporting by Solarina Ho and Euan Rocha; Editing by Andrea Ricci)
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