Loyalty program firm Aimia to cut jobs
MONTREAL The former owner of Aeroplan will cut about one-quarter of its workforce as it charts a new course following the sale of the loyalty program to Air Canada.
Aimia Inc. said Thursday that it expects to reduce its workforce to about 550 staff by the end of 2019, and plans to evolve its business through organic growth from its other businesses and acquisitions.
CEO Jeremy Rabe said the focus on wrapping the Aeroplan sale has prevented an extensive search for potential bolt-ons until recently. “There’s just hundreds and hundreds of smallish loyalty solutions companies out there ... and a lot of them are founder-led and have grown to a certain size but can’t scale too much beyond that,” he said. “(They) have been doing it for 20 or 30 years and are ready to monetize part of their investment.”
North America is “likely to be a market where we spend a lot of time” hunting for loyalty analytics firms, he said. Aimia is on track to become profitable by 2020, he said.
The past two years have been turbulent for the Montreal-based company. Rupert Duchesne stepped down as CEO in January 2017, replaced by Rabe in May 2018. Former president and chief strategy officer Nathaniel Felsher left in November less than three months after he took the job.
Aimia’s global reach has sometimes come at a cost.
In February 2018, the company announced it had sold Nectar, a U.K. loyalty program, to British retailer Sainsbury for $105 million, 11 years after Aimia bought it for $755 million.
Analyst Drew Mcreynolds of RBC Dominion Securities said the new consolidation strategy “will likely take some time to play out.”
“While this outcome of the strategic review was probably the most probable and logical, we do believe the onus is firmly on the company to demonstrate that sustained shareholder value can be created on a timely basis,” Mcreynolds said in a research note to investors.
Bill Mcewan, who became chairman Aimia’s board of directors on Thursday, said it has concluded there is “a tremendous opportunity available” due to a strong balance sheet, tax assets and expertise in the loyalty and travel sectors.