Provided by Aimia Inc/CNW
MONTREAL, June 3, 2019 /CNW Telbec/ – Loyalty and travel-focused consolidator Aimia Inc. (TSX: AIM) announces that it and Air Canada have now finalized all post-closing adjustments from the previously-announced sale of Aeroplan Inc. (formerly Aimia Canada Inc.) to Air Canada, pursuant to the share purchase agreement entered into and announced on November 26, 2018 (“the share purchase agreement”).
A final payment to Aimia by Air Canada of approximately $19 million will result in the transaction having a total purchase price of approximately $516 million. The post-closing adjustments were primarily related to favourable working capital relative to the target working capital set out in the share purchase agreement.
As previously disclosed, $100 million of the proceeds was agreed to be held in a restricted cash account established in conjunction with the sale of Aeroplan Inc. in respect of any re-assessment to be received from the Canada Revenue Agency related to an outstanding audit for the 2012 and 2013 taxation years for Aeroplan Inc.
Aeroplan Inc. has now received notices of re-assessment from the Canada Revenue Agency relating to the audit. The amount to be paid per the final audit letter is approximately $35 million, of which an initial amount of $24 million has already been paid. The balance of approximately $65 million in the restricted cash account would be released to Aimia in accordance with the terms of the share purchase agreement between Aimia and Air Canada.
A notice of objection will be filed in the coming weeks to contest the re-assessments.