Blackstone and La Caisse, together with other Canadian institutions, are making a $2.5 billion minority equity investment in Aeroplan. The transaction terms provide that the investor group is acquiring a 25% non-controlling equity interest in Aeroplan, valuing the program at $10 billion.
Air Canada will maintain full operational control of Aeroplan and a controlling ownership interest after the minority investment. Aeroplan remains a core part of Air Canada’s commercial strategy and customer value proposition, and the experience of members, partners and employees will be unaffected by the transaction.
Proceeds from this investment will be used toward the repayment of Air Canada’s upcoming $1.2 billion bond maturity, strengthening Air Canada’s balance sheet through a reduction in gross indebtedness without a corresponding reduction in cash and cash equivalents. Most of the balance to be applied to accelerate the share repurchases contemplated in its long-term strategic plan.
The investor group led by Blackstone and La Caisse also includes PSP Investments and British Columbia Investment Management (BCI).
“This investment highlights Aeroplan as a differentiated loyalty platform and showcases the exceptional value created since its acquisition,” John Di Bert, executive vice president and chief financial officer at Air Canada, said. “The transaction strengthens Air Canada’s financial position by unlocking value from Aeroplan while retaining full operational control. It provides additional financial flexibility, and supports our pursuit of an investment grade rating, as we execute our long-term strategic plan, for the benefit of our customers, employees and investors.”
Craig Landry, executive vice president and chief innovation officer at Air Canada, and president of Aeroplan, added, “Air Canada has established Aeroplan as one of Canada’s leading loyalty programs, with strategic partnerships across travel, financial and commercial sectors. We are pleased to welcome Blackstone, La Caisse and other leading Canadian institutions as minority investors in Aeroplan as we continue to strengthen and expand Aeroplan’s global appeal. Under the new partnership, Air Canada retains full control of the program, meaning partners, members and employees can all expect full continuity of the program as they do today. Air Canada is committed to remaining the majority owner of Aeroplan, ensuring continued control of the program while positioning it for future growth and value creation.”
Mark Rutledge, senior managing director at Blackstone, said, “We are proud to support Air Canada and the leading loyalty platform they’ve built in Aeroplan. Blackstone is a long-term believer in Canada as both a compelling place to invest and serve clients. This transaction adds to our decades-long commitment to the country and is another example of our ability to provide flexible, efficient capital solutions to leading businesses around the world.”
Martin Longchamps, executive vice-president and head of private equity and private credit at La Caisse, added, “This investment in Aeroplan, one of the country’s leading loyalty programs built by Air Canada, reflects La Caisse’s ability to structure tailored capital solutions backed by a strategic asset, alongside a strong group of co-investors. It is also an attractive diversification opportunity for our global portfolio, which ultimately benefits our depositors.”
The investor group is making a $2.5 billion minority equity investment in Aeroplan, acquiring a 25% equity interest in it. Air Canada will retain a 75% ownership interest and continue to control Aeroplan and its operations, strategic direction and day-to-day management. Proceeds from the transaction will primarily allow Air Canada to repay its upcoming $1.2 billion debt maturity with most of the balance applied to accelerate the share repurchases contemplated in its long-term strategic plan. Settlement of the investment is planned to occur on Aug. 17, 2026.
This investment includes customary minority investor rights. Air Canada will retain control of Aeroplan’s strategy, operations and day-to-day management. Air Canada will continue to consolidate Aeroplan in its consolidated financial statements and this investment will be reflected as a non-controlling interest within shareholders’ equity. The investors will be entitled to participate in distributions from Aeroplan, as and when declared by its board of directors, pursuant to an agreed distribution policy.
Air Canada will also have the right to repurchase the interest held by the investor group in Aeroplan between the fifth and eighth anniversaries of the transaction’s settlement, as well as upon the occurrence of specified events. The repurchase price will be determined pursuant to an agreed formula that provides the investors with an internal rate of return of 6.5% calculated net of all distributions.
Air Canada intends to conduct a substantial issuer bid to purchase for cancellation up to $800 million of its Class A variable voting shares and Class B voting shares. The terms and pricing of the proposed offer are expected to be determined soon after the planned settlement of the Aeroplan minority investment on Aug. 17, 2026. The proposed offer would thereafter be launched with a view to being completed in September 2026. Air Canada intends to fund the proposed offer with proceeds from the investment in Aeroplan.
BofA Securities, Stikeman Elliott and Deloitte respectively acted as advisors to Air Canada and Aeroplan. Scotiabank, Kirkland and Ellis and Blake, Cassels & Graydon respectively acted as advisors to Blackstone.
