TORONTO — A consortium led by Air Canada has reached a deal to acquire the Aeroplan loyalty program from Aimia Inc.
The group, which includes TD Bank, CIBC and Visa Canada Corp., has agreed to pay $450 million in cash and assume the approximately $1.9-billion liability associated with Aeroplan miles customers have accumulated.
"We are pleased to see that an agreement in principle has been reached as Aeroplan members can continue to earn and redeem with confidence," Air Canada chief executive Calin Rovinescu said in a statement on behalf of the consortium Tuesday.
"This transaction, if completed, should produce the best outcome for all stakeholders, including Aeroplan members, as it would allow for a smooth transition to Air Canada's new loyalty program launching in 2020, safeguarding their miles and providing convenience and value for millions of Canadians."
The price is up from an initial offer of $250 million in cash and the assumption of the reward point liability in July that was rejected by Aimia.
The deal is expected to close this fall.
The agreement, which is supported by Aimia's board and Mittleman Brothers, Aimia's largest shareholder, is subject to shareholder approval and other closing conditions.
Mittleman Brothers holds approximately a 17.6 per cent stake in Aimia and agreed to vote in favour of the proposed transaction.
Aeroplan created as in-house program for Air Canada
The future of the program has faced questions since Air Canada announced last year that it planned to launch its own loyalty rewards plan in 2020 when its partnership with Aimia expires.
Air Canada created Aeroplan as in-house loyalty program, but it was spun off as an independent business as part of a court-supervised restructuring of the airline. At the time, CIBC was Aeroplan's main bank partner.
Since 2014, TD has been Aeroplan's main Visa card partner although CIBC continues to offer cards that earn Aeroplan points that can be redeemed for Air Canada flights and other rewards.
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