Inuit-led merger of First Air and Canadian North airlines receives regulatory approval

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Canadian Aviation News

‎Today, ‎June ‎19, ‎2019, ‏‎2 hours ago

 

Inuit-led merger of First Air and Canadian North airlines receives regulatory approval

 

‎Today, ‎June ‎19, ‎2019, ‏‎2 hours ago | Canadian Aviation News

Provided by Makivik Corporation/CNW

Merger to create sustainable airline dedicated to serving Canada’s Northern regions

OTTAWA, June 19, 2019 /CNW/ – Makivik Corporation (Makivik) and the Inuvialuit Corporate Group (ICG) today announced they have received all regulatory approvals to merge First Air and Canadian North in order to provide the best possible air services across the Arctic.

This milestone represents a victory for all Northerners, as the ownership groups have worked diligently over many years within Arctic communities, in consultation with Inuit and other stakeholders, and alongside territorial and federal governments to develop a clear, realistic plan for a strong, sustainable Northern airline.

“This is good news,” said Charlie Watt Sr., Makivik President. “In 1990 we bought a troubled airline, First Air, and made it sustainable. At the time, we promised to create an airline owned by all of the Inuit of Canada and we are now much closer to making that a reality.”

Travellers can be confident that there will be no degradation in service during the merger process, nor following its completion. The parties are committed to ensuring that the merger creates a sustainable airline which provides exceptional customer experience at the best possible prices.

“We are following through on our commitment to act in the best interest of all Northerners,” said Duane Smith, Chair and CEO of the Inuvialuit Regional Corporation (IRC). “By optimizing the Northern air transportation corridor, we are making significant progress in empowering Inuit to become meaningful participants in both the Northern and national economies.”

The new, Pan-Arctic airline will operate under the name “Canadian North” and aircraft will use the First Air livery, featuring its Inukshuk logo. Headquarters for the merged airline will be located in Ottawa.

The parties are committed to keeping customers up-to-date on all developments related to the merger and its operations on an ongoing basis. Whether before or after the merger, both First Air and Canadian North will continue providing Northerners with access to safe, friendly and reliable air travel services across the Arctic.

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Government of Canada approves First Air and Canadian North merger

 

‎Today, ‎June ‎19, ‎2019, ‏‎2 hours ago | Canadian Aviation News

Provided by Transport Canada/CNW

Approval subject to terms and conditions

OTTAWA, June 19, 2019 /CNW/ – From visiting family members, to attending essential medical appointments, to ensuring timely delivery of necessities such as food, medicine and other goods, the Government of Canada understands that a strong and safe aviation system is essential for Canada’s North.

The Honourable Marc Garneau, Minister of Transport, today announced that the Government of Canada has approved a merger between First Air and Canadian North, the primary air carriers serving Canada’s North, subject to a series of strict terms and conditions.

In fall 2018, Makivik Corporation and the Inuvialuit Corporate Group announced an agreement to merge First Air and Canadian North, and filed a merger notification with the Commissioner of Competition and the Minister of Transport. The approval of the merger comes following a public interest assessment, which was led by the Minister of Transport and incorporated the findings of the Commissioner of Competition. Approving the merger with terms and conditions strikes a balance between any public interest considerations and the need to have a more efficient and financially sustainable northern air carrier.

The terms and conditions include:

• No price increases for both passenger travel and cargo delivery beyond those related to operating costs;
• No reductions to the weekly schedule options on all routes of the airlines’ combined network;
• Access to northern infrastructure (facilities and equipment) for new airlines entering the market;
• A commitment to increasing Inuit representation across the merged entity’s operations; and
• Several transparency and accountability measures, such as providing quarterly financial updates and yearly financial statements to the Minister.

The terms and conditions also ensure that items such as nutritious food and essential medical supplies are prioritized for cargo transportation in the North. A confidential Implementation and Monitoring Agreement to be signed between the Minister of Transport and the parent companies of the two merging airlines will ensure compliance with the terms and conditions.

Quote

“The North, more than any other region in Canada, relies on air transportation to maintain quality of life. We carefully examined the public interest, financial and competition aspects of the proposed merger. A strong, financially stable northern air carrier, taking advantage of operating and network efficiencies of a merger, will best serve the North by leading to greater reliability of service as well as environmental sustainability. The strict terms and conditions will keep costs low and ensure northern and remote communities have the access they deserve, while at the same time protecting northern jobs.”

The Honourable Marc Garneau                                        
Minister of Transport

Associated Link

• Privy Council Office Order-in-Council

Transport Canada is online at www.tc.gc.ca. Subscribe to e-news or stay connected through Twitter, Facebook, YouTubeand Flickr to keep up to date on the latest from Transport Canada.

This news release may be made available in alternative formats for persons living with visual disabilities.

SOURCE Transport Canada

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‎Today, ‎July ‎27, ‎2019, ‏‎3 minutes ago

 

Airline officials meet with stakeholders to quell merger concerns

 

‎Today, ‎July ‎27, ‎2019, ‏‎3 minutes ago | Canadian Aviation News

News provided by… (link to full story)

Canadian North, First Air officials warn employees to expect job losses

The newly merged airline presented its new look in Iqaluit last week: Canadian North’s name and First Air’s livery. (Photo by Brian Tattuinee)

By  Sarah Rogers 25 July 2019

Officials from Canadian North and First Air say customers can expect to see the two companies, which are now in the process of merging, branded as one by the end of the year.

Transport Canada approved the merger last month, subject to a list of conditions. The two airlines signed off on the transaction July 10.

Since then, airline officials have launched an informal series of town hall meetings with stakeholders along its travel routes, stopping in Iqaluit July 23 to meet at the Frobisher Inn with clients and community organizations.

The new airline’s incoming CEO and president, Chris Avery, says the process of merging is long and complicated, but the airline is aiming to keep its employees and customers up to date as much as possible.

“We’ve definitely heard concerns about the schedule and the capacity,” Avery said. “And we’ve definitely heard concerns about pricing.

“What we’ve told them is that, our intent has always been about providing that service,” he said.

“Our ownership group is 100 per cent Inuit, and their direction is not about cutting services or raising fares. The merger is about providing the best customer service as possible, and keeping prices as low as possible.”

While the administrative transaction required to fully merge the two airlines could take up to two years, Avery says the airlines plan to have a joint reservation system up by the end of 2019, so the new airline—which will take the name Canadian North—will be presented as one brand.

The estimated 18 to 24 months needed to complete the merger is more administrative and “behind the scenes,” he said.

Up until now, the new airline hasn’t said much about the impact the merger will have on its workforce—an estimated 700 employees with Canadian North and 800 with First Air.

“We realize that causes some uncertainties for our employees,” Avery said. “[This merger] is about gaining efficiencies, so there will be some job losses.”

Avery hopes much of that can happen through attrition or a voluntary separation program. In any case, the new airline said it intends to prioritize northern and Inuit jobs.

New airline in talks with Qikiqtaaluk Corp.

With the new airline jointly run by Nunavik Inuit and Inuvialuit-owned corporations, Nunavut does not have its own stake in the new venture—at least not yet.

Owners Makivik Corp. and the Inuvialuit Regional Corp. are in “active conversation” with the Qikiqtani Inuit Association’s Qikiqtaaluk Corp. about buying an equity stake and having representation on the new airline’s board of directors, Avery said.

Those discussions are also happening with the Kitikmeot Inuit Association.

Canadian North and First Air have made separate bids for the Government of Nunavut’s new medical and duty travel contracts, which include a new public travel component.

The new set of contracts are expected to be announced any time now, though Avery wouldn’t speculate on how the merged airline would deliver on it.

“We’ve both put in submissions, that we’ll obviously honour,” he said. “And we hope we’ll be successful.”