Exchange Income Corporation (EIC) has announced its agreement to acquire Canadian North, marking a significant move for the Winnipeg-based company known for focusing on opportunities within aerospace, aviation, and manufacturing. The deal, valued at $205 million, will see EIC take over the airline from its Inuit-owned partners, Makivvik and the Inuit Development Corporation, following a thorough strategic review process.
According to reports, Canadian North plays a pivotal role as the primary airline across much of the North, providing passenger and cargo services to 24 remote communities spread across Nunavut and the Northwest Territories. It connects these communities to southern gateways, particularly Ottawa and Edmonton, and offers dedicated charter services for resource clients located primarily in northern Alberta and British Columbia.
"Makivvik is proud of the legacy we have built with Canadian North and the service it has provided to Inuit and Northern communities," said Makivvik Corporation, emphasizing the decision to sell as one made with the best interests of their people. EIC is confident the acquisition will allow for improved services and reliability under its management.
Mike Pyle, the CEO of EIC, stated, "Canadian North will be a natural fit with our other northern air operators," citing Calm Air, which already operates in Nunavut. He underscored the acquisition's strategic nature, as it enables EIC to expand its footprint and improve efficiency across the regions it serves.
For Shelly De Caria, who has led Canadian North as its first female and indigenous CEO since December 2023, having EIC as its parent company is pivotal. "Having a strong parent company with roots in Northern aviation is important to our success," she mentioned, indicating her optimism about working within the EIC family to grow Canadian North’s business.
While the executive leadership of Canadian North expressed enthusiasm for the acquisition, the airline has faced notable challenges over the past few years, particularly following its merger with First Air back in 2019. Despite combining resources, Canadian North has struggled with operational efficiency, flying fewer scheduled flights post-merger compared to both companies' operations prior to the merger.
Infrastructure issues, including short, unpaved runways across many of its operational areas, along with persistent pilot shortages and inadequate funding, have also posed hurdles for the airline. The service remains integral for the communities it serves, as many northern areas have no road access to southern Canada.
Following the sale, which remains subject to regulatory approval, EIC anticipates the transaction will be finalized later this year. The acquisition is also set to exclude the Montreal-Kuujjuaq route, which will continue under Makivvik until it transitions to Air Inuit.
This acquisition isn't EIC's first venture within northern aviation; it previously acquired Calm Air as part of its strategic growth initiatives. The union of resources and expertise between the two companies is expected to lead to more effective service provision to the communities reliant on these airlines.
"The acquisition of Canadian North will enable EIC to service all regions in the far North for the first time," EIC noted. This aligns with their commitment to provide stable and efficient services as well as translate local aviation resources, knowledge, and assets to benefit northern communities effectively.
With deep community ties and established operational protocols, EIC is poised to leverage these assets to contribute to the growth and sustainability of Canadian North, paving the way for potentially transformative aviation services across the Arctic. It seems like the foundations for enhanced services and community investment initiatives are already being laid out, signaling hopeful prospects for both the airline and the communities it serves.