Government Greenlights Major Arctic Merger

by Jake Smith

Transport Canada today announced that they’d be authorizing the merger between First Air and Canadian North, 2 of the larger Arctic carriers in Canada’s Northern Territories. The decision comes despite a finding by the Canadian Federal Competition Bureau that such a merger could incentivize higher prices and lower quality server on routes in the north except Edmonton to Yellowknife.

An increase in prices could be detrimental to residents in the remote communities of Canada’s north who heavily rely on services from airlines such as First Air and Canadian North as their only source of transportation for much of the year. The federal government has however said it has taken precautions in their authorizing of the merger to protect against any price hikes.

A media release from First air said the following:
Canadian North and First Air are pleased to confirm that our respective ownership groups, Inuvialuit Regional Corporation (IRC) and Makivik Corporation, have received regulatory approval to combine our people and resources into a strong, unified new pan-Arctic airline that will provide safe and sustainable air service to Northern customers and charter clients under the name ‘Canadian North’.

Makivik and IRC have released a separate announcement (shown here) that reaffirms their commitment to ensuring that the merged airline continues to meet the needs and expectations of Northerners throughout the integration and beyond. They will now prepare to complete the necessary transaction that will formalize this merger and enable us to begin the multi-phase integration of our operations.

Detailed information about the upcoming start of the integration process will be provided when the merger transaction is completed within the coming weeks. In the meantime, Canadian North and First Air will continue to operate as two separate entities, providing safe, friendly and reliable air service to our respective customers.

Canadian North and First Air commend everyone who contributed to this approval process, for recognizing the many benefits that this merger will provide to the residents of Northern Canada who depend on the availability of safe and sustainable year-round passenger and cargo service for all aspects of their lives. By combining our people and resources into a strong, unified airline, we will be able to operate far more efficiently and the improved sustainability we achieve will create new paths for us to invest in our long-term growth and renewal, for the benefit of everyone we serve.

Canadian North Airlines was founded in 1989 as a subsidiary of Canadian Airlines with a focus on the needs of northern communities and was purchased in 1998 by Norterra which is a wholly Aboriginal-owned holding company.

First Air was founded in 1946 by Canadian aviation pioneer Russel Bradley. First Air started scheduled operations in 1973 between Ottawa and North Bay.  The company was purchased in 1990 by the Makivik Corporation who are an Inuit owned company based in Quebec.

 

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