Air Canada sells 25% stake in Aeroplan

Air Canada has reached an agreement for funds managed by Blackstone Inc. (BX) and Caisse de dépôt et placement du Québec, together with other Canadian institutional investors, to make a $2.5 billion minority equity investment in Aeroplan Inc. The transaction will give the investor group a 25% non-controlling equity interest in the loyalty program.

The agreed consideration implies a $10 billion valuation for Aeroplan. The investment is structured as a minority stake, with no transfer of operational control to the new investors.

Settlement of the investment is planned to occur on August 17, 2026. The agreement positions Aeroplan as a standalone asset with a clearly defined external valuation while remaining closely tied to Air Canada’s broader business.

Following completion of the transaction, Air Canada will retain a 75% ownership interest in Aeroplan. Despite the significant minority investment, Air Canada will maintain full operational control of the program.

Aeroplan will continue to be consolidated in Air Canada’s financial statements. The new investor participation will be reflected as a non-controlling interest, preserving Air Canada’s status as the controlling shareholder.

This structure allows Air Canada to unlock capital from Aeroplan while keeping the program closely integrated with its core airline operations and financial reporting.

Air Canada plans to use the majority of the $2.5 billion proceeds to repay an upcoming US$1.2 billion bond maturity, estimated at about $1.7 billion. This allocation is aimed at addressing near-term debt obligations.

Most of the remaining funds will be directed toward accelerating a previously planned share repurchase program of up to $800 million. The transaction therefore supports both balance sheet management and returns of capital to shareholders.

By combining debt repayment with equity buybacks, the company is using the Aeroplan minority sale to fund multiple capital priorities without relinquishing control of the loyalty program.

With settlement targeted for August 17, 2026, the transaction provides a clear timetable for when the new capital is expected to be available. Until that date, Air Canada remains the sole owner of Aeroplan.

The deal brings long-term institutional investors into Aeroplan while confirming Air Canada’s intention to keep the program central to its strategy. The defined 25% non-controlling stake balances external funding with continued internal control.