Key Takeaways:
Air Canada is selling a 25% stake in its Aeroplan loyalty program for $2.5 billion to Blackstone and La Caisse, valuing the unit at $10 billion while keeping full control.
"This investment highlights Aeroplan as a differentiated loyalty platform and showcases the exceptional value created since its acquisition," said John Di Bert, executive vice president and chief financial officer at Air Canada.
The investor group, which also includes PSP Investments and British Columbia Investment Management Corp., will hold a 25% non-controlling interest. Air Canada retains 75% ownership and will continue to consolidate Aeroplan in its financial statements, reflecting the investment as a non-controlling interest within shareholders' equity. Proceeds will repay an upcoming US$1.2 billion ($1.7 billion) bond maturity, with most of the balance accelerating share repurchases.
Air Canada separately plans a substantial issuer bid to buy back up to $800 million of shares via a modified Dutch auction, expected to complete in September. The carrier holds a call option to repurchase the investors' stake between the fifth and eighth anniversaries at a price providing a 6.5 percent internal rate of return net of distributions.
Air Canada will retain control of Aeroplan's strategy, operations and day-to-day management, with the investment including customary minority investor rights. The investors will participate in distributions from Aeroplan as declared by its board under an agreed distribution policy. Settlement is planned for Aug. 17, 2026.
The transaction values Aeroplan, which counts more than 10 million active members and redemption access to over 50 airlines serving 1,300-plus destinations, at $10 billion. Air Canada shares rose 5.9 percent to C$27.27 on the Toronto Stock Exchange following the announcement.
"We are proud to support Air Canada and the leading loyalty platform they've built in Aeroplan," said Mark Rutledge, senior managing director at Blackstone. "This transaction adds to our decades-long commitment to the country."
"This investment in Aeroplan reflects La Caisse's ability to structure tailored capital solutions backed by a strategic asset," said Martin Longchamps, executive vice president and head of private equity and private credit at La Caisse.
BofA Securities, Stikeman Elliott LLP and Deloitte LLP advised Air Canada and Aeroplan, while Scotiabank, Kirkland & Ellis LLP and Blake, Cassels & Graydon LLP advised Blackstone.
The deal ranks among the largest monetizations of an airline loyalty program, giving Air Canada fresh capital to cut debt while retaining the earnings power of a unit that generates recurring revenue from more than 10 million members. The structure — a minority stake with a guaranteed 6.5 percent return for investors and a call option for Air Canada — lets the carrier unlock value without surrendering control, a template other airlines may follow as loyalty assets draw institutional demand.
This article is for informational purposes only and does not constitute investment advice.
