Air Canada Enters Agreement to Acquire the Aeroplan Loyalty Program

Air Canada is Canada’s largest domestic and international airline, serving more than 200 airports on six continents. The company provides scheduled passenger service directly to 63 airports in Canada, 56 in the United States, and 98 in Europe, the Middle East, Africa, Asia, Australia, the Caribbean, Mexico, Central America, and South America.
 
Recently, the company, along with its partners The Toronto-Dominion Bank, the Canadian Imperial Bank of Commerce, and Visa Canada Corporation, finalized an agreement to acquire Aimia’s Aeroplan loyalty program. Air Canada provided the following updates on this acquisition and outlined significant developments in the relaunch of the program in 2020.
 
Concurrently with the signing of the share purchase agreement, Air Canada and its partners signed various commercial agreements relating to the acquisition, including credit card loyalty program and network agreements for future participation in the loyalty program, all of which are conditional on closing the acquisition of Aeroplan. Additionally, Air Canada remains in negotiations with American Express, which also issues Aeroplan co-branded products, to secure its continued participation in the Aeroplan program after 2020.
 
“We are extremely pleased to have concluded the agreement for the purchase of Aimia Canada and to have reached definitive agreements on our co-branded credit card programs with each of TD and CIBC,” says Calin Rovinescu, President and CEO of Air Canada. “Subject to closing the purchase transaction, these agreements will produce the best outcome for our customers as well as those of our partners as they will facilitate a smooth transition to our new loyalty program launching in 2020, safeguarding all Aeroplan Miles and providing convenience and value for millions of Canadians. Our program is expected to be one of the best loyalty programs in the industry, which will be exciting for our customers and we are looking forward to communicating details later next year.”
 
The acquisition of Aimia Canada remains subject to Aimia shareholder approval and certain other closing conditions, including receipt of applicable regulatory approvals. The closing of the acquisition is expected to occur in January 2019.
 
The aggregate purchase price consists of $450 million in cash subject to post-closing adjustments and includes the assumption of approximately $1.9 billion of Aeroplan Miles liability. Air Canada will receive payments from TD and CIBC in the aggregate amount of $822 million. Visa will also make a payment to Air Canada.  In addition, TD and CIBC will make payments to Air Canada, at closing, in the aggregate amount of $400 million as prepayments to be applied towards future monthly payments in respect of Aeroplan miles.
 

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