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Aimia pushes for higher offer for Aeroplan
Posted on Friday, 03 August 2018 14:00
Having dismissed a recent offer of CAD 325.00 million (USD 249.58 million) from its group of investors, Aimia is now engaged in discussions to reach an agreement to reflect an accurate value for its Aeroplan business.
The consortium bidding for the assets includes Air Canada, the Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Visa Canada.
An original offer of CAD 250.00 million was made, in addition to the assumption of CAD 2.00 billion in liabilities.
The vendor has valued the business at CAD 450.00 million and is proposing that the consortium make a bid to match this amount.
Aimia felt the initial proposal did not represent the value of Aeroplan, prompting the company to consider other suitors.
It has attracted interest and is currently in talks with Oneworld, despite it being a competitor of Air Canada through the latter’s membership with Star Alliance.
The airline alliance business may provide a lifeline for Aeroplan, media reports suggest, as its standing contract with Air Canada expires in 2020.
However, Oneworld has stated that there is no certainty that a deal will be concluded, which has thrown the future of Aimia’s business in doubt.
To make matters worse, Air Canada has announced it is to launch a frequent-flyer programme of its own that has caused shockwaves in the vendor’s shares, which dropped 60.0 per cent in just one day in May 2017.
Some analysts and investors, according to Reuters, have argued that the data marketing business may be setting the bar too high and might have to settle for the best offer it receives.
Greg Taylor, a portfolio manager at Purpose Investments, told the news provider that the proposal from the consortium represents the most beneficial deal with Air Canada providing the most synergies, but the vendor might be over-reaching itself in order to find a “white knight bid”.
This comes after Aimia, just last month, rejected an offer of USD 180.00 million from Aeromexico for its 48.8 per cent stake in PLM Premier.
Headquartered in Canada, Aeroplan claims to be the premier travel loyalty program in the country, with a network of over 75 established partners and more than 150 brands in the retail, financial and travel sector.
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