In a major shakeup for North American aviation, Delta Air Lines and Korean Air are taking minority stakes in Calgary-based WestJet.
Delta will acquire a 15% stake for US$330 million, while Korean Air will invest US$220 million for a 10% stake.
Both equity purchases are from Onex Partners, the private equity arm of Canadian investment giant Onex.
Upon closing, Delta also plans to sell 2.3% of its stake to joint venture partner Air France-KLM for US$50 million, pending approval from the European carrier.
The move marks a pivotal moment for WestJet as it further aligns itself with global airline powerhouses.
The investments signal confidence in WestJet’s post-pandemic performance and growth strategy, and bolster the airline’s global connectivity across North America, Europe, and Asia.
"Investing in a world-class partner like WestJet aligns our interests and ensures that we remain focused on providing a world-class global network and customer experience for travelers in the United States and Canada," said Delta CEO Ed Bastian.
Korean Air CEO Walter Cho echoed the sentiment.
"This strategic partnership will enhance our global network and create long-term value for customers through greater choice and convenience," Cho said in a statement.
WestJet has long maintained codeshare partnerships with both Delta and Korean Air, but the new equity ties mark a significant escalation in collaboration.
Tawfiq Popatia, Co-Head of Onex Partners, welcomed the deal, calling Delta, Korean, and Air France-KLM “among the world’s most prominent and best-managed airlines.”
"These investments, and the enhanced partnerships they bring, are an endorsement of our people and WestJet's differentiated performance through an extraordinary period for aviation in recent years," added WestJet CEO Alexis von Hoensbroech.
The Onex Group will retain control of WestJet, which it acquired in 2019. Barclays is advising WestJet and Onex on the transaction, which is subject to regulatory approval.
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