Air Canada’s proposed takeover of Transat A.T. Inc. is on more fragile footing after a deadline to close the deal lapsed on Monday, putting either party in a position to walk away at a moment’s notice.

In a release Tuesday morning, Transat disclosed that Air Canada has indicated it has no intention of negotiating an extension of the Feb. 15 so-called outside date for wrapping up the deal while the two parties await regulatory approval from the European Commission.

“As a result of the occurrence of the outside date without the prior receipt of required approval from the Commission, each of Air Canada and Transat are currently entitled, at any time, to terminate the arrangement agreement upon notice to the other party. Until terminated or amended by the parties, the arrangement agreement remains in effect in accordance with all of its terms,” Transat said in its release.

While the two airlines await a green light for their deal in Europe, they received a go-ahead from the Canadian government on Feb. 11, which pointed to the COVID-19 pandemic as a “key factor” for allowing the transaction to proceed. The government did, however, staple a slew of conditions to its approval, including committing to have 1,500 employees on the combined entity’s leisure travel business.

The suspense has prompted questions about what could come next in the protracted takeover process.

“At this time, it is difficult to gauge Air Canada’s commitment/engagement regarding the proposed transaction as market conditions have deteriorated over the last months,” Desjardins Securities Analyst Benoit Poirier wrote in a report to clients Tuesday.

Poirier noted that the unsolicited $5-per-share proposal from Pierre Karl Péladeau disclosed by Transat last month could prop up the airline’s stock price. He also hypothesized that another big name could make a play if the deal with Air Canada falls through.

“Onex could be another suitable contender, in our view,” he wrote. “While WestJet’s CEO recently expressed his disappointment following the federal government’s approval of the (Air Canada) deal, we believe the company could also be a potential contender. Such a deal would take time to finalize, although there would be fewer antitrust issues, in our view.”