The transaction, first announced in March last year, strengthens WestJet’s all-inclusive offering by adding tour operator services to the offering, although the two brands will “initially” operate separately.
However, the two airlines will move from competitors to collaborating partners, positioning Sunwing as a “key pillar of the WestJet Group,” as the latter explained in a press release.
The move expands Calgary-based WestJet’s reach in eastern Canada, particularly in the tour operator sector, where the company aims to compete with Montreal-based Air Canada and Transat AT.
The federal government approved WestJet’s acquisition of Sunwing in March, despite a warning from the Competition Office. He believed the takeover by Canada’s second-biggest airline would likely result in higher prices and lower performance, particularly when it comes to packages.
In approving the transaction, Ottawa placed conditions that include expanding Sunwing packages to five new cities, maintaining capacity on the hardest-hit routes, and maintaining a vacation division business headquarters in Toronto and a regional headquarters in Montreal for at least five include years.
According to Airfleets.net, the deal adds around 2,000 employees and 18 Boeing 737s to WestJet Airlines’ fleet of 109 aircraft, which consists entirely of Boeing aircraft (excluding the regional service WestJet Encore).
Financial details of the acquisition were not disclosed.
Stephen Hunter, former CEO of Sunwing Vacations, has been appointed CEO of WestJet Group Vacations. Mr. Hunter will be responsible for all tour operator activities and packages for Sunwing Vacations and WestJet Vacations.
“The combination of our complementary businesses represents an important step that will allow us to accelerate our growth plans and offer Canadians more affordable vacations in more destinations than ever before,” Hunter said in a statement.
Both companies are privately held, with parent company Sunwing Travel Group majority-owned by the Hunter family and WestJet owned by Toronto-based investment manager Onex, which closed the airline’s equity when it bought it for $5 billion in 2019 became.
WestJet and Sunwing account for approximately 37% of seat capacity on non-stop flights between Canada and sunny destinations. That number rises to 72% between western Canada and sunny destinations, the Competition Bureau calculated in a report presented to the Secretary of Transportation in October.
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