RE:Aeroplan parent in talks with Oneworld airline alliance amid Aeroplan’s parent company, Aimia Inc., is currently in partnership talks with the Oneworld airline alliance as it fends off a recent hostile takeover bid from Air Canada and three financial partners.
The talks, which Aimia confirmed Wednesday, extend the company’s efforts to re-position Aeroplan once its contract with Air Canada expires in 2020. Under new leadership, the loyalty program has recently committed to keeping its existing redemption grid once the Air Canada contract ends, so that members will not pay more for flights, and it has publicly stated it will allow members to book seats on any airline come 2020.
Behind the scenes, Aimia has also been negotiating a new partnership with the Oneworld alliance, whose member airlines include British Airways, American Airlines and Cathay Pacific. Oneworld is a direct competitor to Star Alliance, of which Air Canada is a member. The revelation that Aimia is in talks with Oneworld casts new light on the takeover bid led by Air Canada.
“I can confirm that we are in discussions with Oneworld as a potential preferred airline partner,” an Aimia spokesperson wrote in an e-mail to The Globe and Mail.
Last week, Air Canada teamed up with Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Visa Canada Corp. on a bid to purchase the Aeroplan program for $250-million in cash. Air Canada and its partners would also assume a $2-billion outstanding liability on Aimia’s books for loyalty points that have not yet been redeemed. Aimia currently has $300-million in cash reserved to cover these liabilities.
The bid comes a year after Air Canada unveiled plans to launch its own loyalty program, prompting shares in Aimia to plummet 63 per cent in a single day.
The bidding consortium gave Aimia a week to respond to their offer, which expires Aug. 2.
Last Friday, Air Canada chief executive Calin Rovinescu said the bid has such a limited time frame because the airline will need to re-focus on building its own in-house program if it is rejected.
However, in a question-and-answer section of its website, Air Canada has also stated that it became aware of talks between Aimia and others – but wouldn’t specify which discussions. “There have been other proposed transactions to purchase Aimia over the past several months,” the website reads.
Last week, Aeromexico announced its own hostile bid to buy Aimia’s stake in a Mexican loyalty rewards program – an offer Aimia quickly shot down. While it was not a bid for the whole company, it is possible Air Canada became aware of it.
A partnership with Oneworld may be another example of negotiations that Air Canada feared.
Air Canada and Oneworld did not immediately return requests for comment.