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A would-be buyer of Transat AT Inc. says it has secured backing from the Quebec government for its bid for the company, a day before Air Canada’s exclusive talks to buy the airline and travel operator are set to expire.

Group Mach, a Montreal-based real estate developer, said on Tuesday it has waived the finance conditions attached to its offer to buy Transat for $14 a share, in addition to dropping a requirement of support from two large Quebec investors in Transat, the Fonds de solidarité FTQ and the Caisse de dépôt et placement du Québec.

“We have waived those financing conditions in light of the agreement we have with the government,” Alfred Buggé, executive vice-president of Mach, said by phone from Montreal. He said the agreement with the provincial government is confidential and would not provide details. But the firm said the agreement was non-binding.

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“We don’t have an agreement with the FTQ or Caisse de dépôt,” he said.

Transat’s stock climbed nearly 4 per cent to close at $14.02 Tuesday.

Mach’s initial proposal to buy Transat, issued in a news release on June 4, was conditional on $120-million in backing from Investissement Québec, the province’s financing arm, and the support of the FTQ and the Caisse.

Isabelle Fontaine, spokeswoman for Investissement Québec, declined to comment, saying the agency never discusses conversations it has with potential buyers.

Patrick McQuilken, spokesman for the FTQ, said the labour fund has not signed a lockup agreement with any parties involved in the Transat file. Maxime Chagnon, spokesman for the Caisse de dépôt et placement du Québec, declined to comment.

Transat said on May 16 it would hold exclusive talks with Air Canada to be bought at $13 a share, or $520-million. The takeover, subject to approval by two-thirds of Transat shareholders and by federal regulators, would give Air Canada about 63 per cent of trans-Atlantic flights from Canada, and the majority of gate slots at Montreal’s Pierre Elliott Trudeau International Airport.

Two big investors in Transat have said the Air Canada offer is too low, or it is too soon in the company’s path to better profitability and higher market value.

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Christophe Hennebelle, a spokesman for Transat, said the talks are expected to continue into Wednesday, when the exclusivity period ends. At that time, he said one of three things will happen: the two sides will sign a takeover agreement; talks will be extended; or no deal is signed and the two sides walk away.

Mr. Buggé said Mach’s revised offer was given to Transat’s board on Tuesday. “If the exclusivity [period] expires tomorrow, then they are free to deal with whoever they want,” he said.

Mach says under its ownership Spanish property developer TM Grupo Inmobiliario would become a minority investor in Transat, and use its vacation-property expertise to help develop Transat’s hotel and holiday business. TM builds holiday homes in the Mediterranean and operates three hotels in Mexico called The Fives Hotels and Residences.

Transat has embarked on a strategy of expanding its vacation business with the 2018 purchase of waterfront property in Puerto Morelos, Mexico, and plans to own or manage 5,000 sun-destination hotel rooms by 2024.

Air Canada entered the takeover talks shortly after Toronto-based investment manager Onex Corp. announced a friendly deal to buy Canada’s second-biggest airline, WestJet Airlines Ltd. of Calgary. That deal must be approved by two-thirds of WestJet shareholders on July 23. WestJet said on Monday the takeover has been approved by the Minister of Transport, and needs approval by an Alberta court.

Another Montreal-based investor, FNC Capital, has expressed interest in buying Transat. FNC says on its website it is “working to produce a friendly” offer worth between $17 and $20 a share.

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Mr. Buggé said FNC has yet to provide details of its proposal or even issue a news release. “Until they put pen to paper ... I don’t take this seriously, with all due respect to FNC,” he said.

Dominik Pigeon, owner of FNC, said in an interview he is not ready to name his proposed financial or operating partners, but that he looks forward to the end of the Transat-Air Canada talks so Transat can engage in talks with other parties and allow access to confidential financial information. “I’m working on providing an offer to the company, eventually. I cannot be more precise than that at this time,” he said.

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