Canada's largest airline is about to grow even larger, if all goes as planned over the next month, with the announcement of a pending $520 million agreement to purchase another Canadian carrier and tourism company.

Air Canada and Transat A.T. Inc. announced the news on Thursday morning, the latter company noting in a press release that it had "agreed to a 30-day period of exclusive negotiations" with Air Canada.

"This announcement is good news for Transat," said the Montreal-based airline's president and CEO Jean-Marc Eustache. "This is an opportunity to team up with a great company that knows and understands our industry and has had undisputable success in the travel business."

Air Transat, which has an operating base at Toronto's Pearson International Airport, currently serves 60 destinations in 25 different countries.

The airline's parent company, Transat A.T. Inc, owns nearly 600 travel agencies in Canada and has been offering vacation packages, hotel stays, and tour operation services since 1987.

"The proposed transaction, valued at approximately $520 million or $13 per share of Transat," writes Air Canada of the proposed merger, "will create a Montreal-based global travel services company in leisure, tourism and travel distribution operating across Canada and internationally."

Transat maintains that operations will continue as normal throughout the negotiation period. Clients, suppliers and employees should be unaffected.