Air Canada Airbus A321XLR. Photo: Air Canada Air Canada has finalized the terms of a planned $800 million substantial issuer bid, giving shareholders an opportunity to sell shares back to the airline as it seeks to return capital while maintaining investment in its future growth.
The offer is expected to begin on August 20, 2026, and will remain open until 11:59 p.m. Eastern time on September 24, unless Air Canada extends, changes or withdraws it.
Under the modified Dutch auction, shareholders can tender their Class A variable voting shares or Class B voting shares at prices ranging from C$29.00 to C$33.00 per share, in C$0.10 increments.
Air Canada could repurchase up to 27,586,206 shares, representing approximately 9.8% of its 280.17 million outstanding shares if the final purchase price is C$29.00. At the maximum price of C$33.00, the airline would repurchase approximately 8.7% of its outstanding shares.
The final price will be determined after the offer expires. Air Canada will select the lowest price that allows it to purchase the maximum number of validly tendered shares without exceeding the C$800 million budget.
Shareholders can participate through either an auction tender, where they specify a price within the C$29 to C$33 range, or a purchase price tender, where they agree to sell at the final price established by the auction.
If demand exceeds the amount Air Canada can purchase, shares will generally be bought on a pro rata basis. Holders of fewer than 100 shares will not be subject to proration.
The airline said the transaction will be funded partly with proceeds from the recently announced minority equity investment in Aeroplan by funds managed by Blackstone and La Caisse, alongside other Canadian institutional investors. Air Canada said those proceeds have now been received in full.
All shares purchased through the offer will be canceled. As a result, shareholders who do not tender, or whose shares are not purchased, will see their proportional ownership interest increase following the buyback.
Air Canada’s board has approved the offer, but the company is not recommending whether shareholders should participate. Investors are being urged to review the official offer documents and consult financial, legal, investment and tax advisers before making a decision.
The airline expects to distribute the formal offer documents on August 20 and file them with Canadian securities regulators through SEDAR+.