NEW PARTNERSHIP

Aimia announces a new partner, Porter Airlines, as talks continue with Air Canada for Aeroplan,

Aimia Inc. says it remains open to negotiating a fair deal for the purchase of its Aeroplan loyalty program by Air Canada and its partners despite striking a deal with Toronto-based Porter Airlines and holding discussions with the Oneworld airline alliance.

“We never stop negotiating. Should the consortium want to engage with us in a constructive dialogue, we would be happy to entertain that,” Aimia CEO Jeremy Rabe said Friday during a conference call.

“At the same time, we feel very confident about our future plans. So either or, we’re happy to go down either path.”

Rabe insisted that Aimia didn’t reject the Air Canada group’s offer, but said it was very conditional and didn’t fairly value the business.

The consortium — which includes Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Visa Canada — initially offered $250 million cash and the absorption of $2 billion of mileage liability, but subsequently raised the offer to $325 million, still short of the $450 million Aimia believes would be a fair price.

“We have a number of shareholders that are frankly pretty upset that we offered a number that low,” Rabe said.

One of those shareholders — Cetus Capital — said it is frustrated by the consortium’s lower offer.

“We’re scratching our heads as to why the offer is so low in light of the significant and substantial strategic and financial benefits to Air Canada and the consortium partners,” Bart Stout said during the call, outlining a series of strategic benefits to the airline and its credit card partners.

They include the significant cash Aeroplan generates for Air Canada, the valuation discount relative to other airlines that would decrease by having its own in-house loyalty program and a lower risk for the credit card partners who may not be chosen as a partner for Air Canada in a stand-alone plan.

“We continue to believe that Air Canada is acting very penny-wise pound-foolish as it relates to their tactics here. They should be more than willing, more than excited to acquire Aeroplan. Frankly, we believe the value that they should be acquiring Aeroplan for should be significantly more than $450 million.”