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ACE investors approve dissolution, protesters rally

The Aveos plant is shown in Montreal, March 28, 2012.

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Hundreds of protesters --- including employees of Aveos Fleet Performance Inc. – blocked a street in downtown Montreal in front of the building where shareholders voted to liquidate ACE Aviation Holdings Inc., the former parent of Air Canada and Aveos.

Security guards at the venue, the Montreal Museum of Fine Arts, locked the doors and would not let visitors or the media into the meeting, which they insisted had been cancelled.

But ACE said in a news release that the annual and special meeting occurred earlier in the day and that shareholders approved a special resolution to convert all Class A and Class B variable voting shares into a new class of common shares on a one-to-one basis.

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The company also said shareholders approved the special resolution calling for the voluntary liquidation of ACE through the distribution of the remaining assets.

ACE said it will make an initial distribution to shareholders of between $250-million and $300-million, within the coming weeks.

The protesters, including politicians, students and union officials, slammed Air Canada and the federal government for allegedly allowing Aveos to wither away.

They targeted the Harper government, saying it has failed to enforce a law requiring major maintenance work for Air Canada to be done in Canada.

The demonstrators also took aim at senior management at Air Canada and ACE, some holding signs referring to reports that ACE chief executive Robert Milton made about $82-million for spearheading the selling off of assets that included Aveos.

ACE was at one time Air Canada's largest shareholder.

Between 2004 and 2011, ACE returned $4.5-billion to shareholders from the sale of its equity interests in Air Canada's former operations, including aircraft-overhaul company Aveos.

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Aveos, formerly known as Air Canada Technical Services, went bankrupt last month, putting 2,600 people across the country out of work.

Aveos executives blamed Air Canada for its troubles, saying the airline put off or outright cancelled critical maintenance work.

The Quebec government has offered to provide financial support to potential new owners of insolvent Aveos.

Quebec is also suing Air Canada under the federal Air Canada Public Participation Act to ensure that the Aveos jobs in Montreal are protected.

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About the Author
Quebec Business Correspondent

Bertrand has been covering Quebec business and finance since 2000. Before joining The Globe and Mail in 2000, he was the Toronto-based national business correspondent for Southam News. He has a B.A. from McGill University and a Bachelor of Applied Arts from Ryerson. More

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