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Canada Jetlines to go public in reverse takeover as it races to be first ultra-low cost carrier to take off

The Canadian Transport Agency has told Jetlines that it needs $40 million in funding before it can operate.

In the wake of NewLeaf Travel Co.’s failed attempt to launch service recently, Canada Jetlines Ltd. revealed Wednesday intends to go public because it aims to be the first ultra-low-cost airline out of the gate.

Jetlines can place around the TSX Venture Exchange inside a reverse takeover of Jet Metal Corp., a junior uranium explorer, with the dpo expected to occur between May. The Richmond, B.C.-based airline had intended using this route earlier, but held off due to market uncertainty. Strong signals from investors prompted it to resume its course.

According to terms of the arrangement, each 1.5 share of Jet Metal will convert to one share of the new company, that will list underneath the same symbol, JET. Each Jetlines share is going to be treated as 1.5 shares from the new entity. The transaction is susceptible to TSX approval.

Jetlines chief executive Jim Scott said once the company released a proposal for shell companies, several came forward. Last Thursday the board of directors selected Jet Metal, which owns uranium properties in Newfoundland and Wyoming.

Jet Metal shares have not traded since Jan. 15, when talks began with Jetlines.

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