MONTREAL, June 3 /CNW Telbec/ - Air Canada announced today that it had
signed a letter of intent with American Express with respect to a new co-
branded consumer and corporate charge card program and Aeroplan`s
participation in American Express` Canadian and international Membership
Rewards Programs. In addition, American Express will provide Air Canada with a
cash advance, repaid as Aeroplan Miles are purchased.
The letter of intent follows the bid process that was recommended by the
court appointed Monitor in the CCAA proceedings and ordered by Mr. Justice
Farley on May 1, 2003. On May 13, 2003, the Monitor reported that the bid
process had also resulted in an amendment to the exclusivity arrangements with
CIBC that allows Air Canada to enter into partnership with an additional
charge card provider.
“The ability to attract a company of the calibre of American Express is
an additional powerful affirmation of Aeroplan`s value as one of North
America`s leading loyalty programs and the strength of the Air Canada
franchise, in particular after the restructuring is completed,” said Calin
Rovinescu, Air Canada`s Chief Restructuring Officer. “This new relationship
enables Aeroplan to broaden its appeal to premium Canadian households as the
reward program of choice. The cash advance facility demonstrates on-going
confidence that Air Canada`s restructuring plans are progressing well, and
provides the company with additional liquidity during the process. The
proceeds will be drawn down only after the ratification of the tentative
agreements recently completed with our labour groups.”
The letter of intent includes basic terms of the new contract and the
cash advance and provides American Express with an exclusive right to
negotiate a definitive agreement relating to a new charge card program for
Aeroplan until July 31, 2003. The new contract will be subject to court
approval in the CCAA proceedings.
American Express in Canada operates as Amex Canada Inc. and Amex Bank of
Canada. Both are wholly owned subsidiaries of the New York based American
Express Travel Related Services Company, Inc., the largest operating unit of
the American Express Company. Amex Canada Inc. operates the Corporate Travel,
Consulting, Travel Services Network and Travellers Cheque divisions in Canada.
Amex Bank of Canada is the issuer of American Express Cards in Canada.
Air Canada`s frequent flyer program, Aeroplan, is known as one of the
most rewarding loyalty programs in the industry. Aeroplan has been voted the
world`s Best Frequent Flyer Program for the second consecutive year at the
2003 OAG (Official Airline Guide) Airline of the Year Awards on April 10,