First Air CEO hopes for merger plan by July

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First Air is aiming to form an agreement with Canadian North for a proposed merger in the next three months, says Brock Friesen, president and chief executive of the Kanata, Ontario-based carrier.

“We hope that we could go for regulatory approval, let’s say, in July,” he tells Flightglobal.

Canada’s competition bureau has confirmed it will review the proposal once it is formed. This process could take up to six more months, says Friesen. The two airlines will be merged under a new company with yet-to-be-determined name, says Friesen.

The airlines do not expect the merger to result in substantial cuts to employees or service, says Friesen. Routes that both carriers serve today could stay intact under the merged carrier if scheduled at different times of the day, he notes.

First Air’s specialty in scheduled flights combined with Canadian North’s charter flights to Canada’s northernmost destinations gives the carrier the “opportunity to create economies of scale without having to do a lot of cutting,” he says. The carriers offer a mix of cargo and passenger flights.

“We can do a better job of serving the North--more flights, more connections, more economic fares,” he says, noting that savings on items like fuel from a potential merger could curb fare increases.

The merger could also allow First Air to employ a fleet renewal strategy, says Friesen.

“We’ll shed some older airplanes and we’ll take in some newer airplanes,” he says, nothing that the transition would probably not occur until the end of 2015. The carrier’s fleet of ATR turboprops may grow because the aircraft can land on the gravel runways in many of the airports that First Air serves.

Kanata, Ontario-based First Air flies to 30 northern cities with gateways from Ottawa, Montreal, Winnipeg and Edmonton. The airline is owned by Kuujjuaq, Quebec-based Makivik Corporation and employs about 1,000 people.

First Air operates nine ATR 42-300 turboprops and two ATR 72-200s, including one -200 freighter. It also operates three Boeing 737-400s, including two combis, six 737-200s, one Boeing 767-200SF and two Lockheed L-100-30 Hercules aircraft.

Calgary-based Canadian North flies to 19 cities in Canada’s Northwest Territories and Nunavut from bases in Edmonton and Ottawa. The airline operates five 737-300s, seven 737-200s and four Bombardier Dash 8 Q400 turboprops, Flightglobal’s Ascend Online database shows.The airline is a subsidiary of Edmonton-based Norterra.