Canada Jetlines, the newest all-Canadian leisure carrier, has just announced its intention to undertake a non-brokered private placement to raise $2,850,000.

The placement consists of units issued at $0.35 per unit, consisting of one common share and an additional half-warrant.

Each warrant will entitle its holder to purchase one additional share for four years after closing at $0.50 per warrant share during the first two years after issuance. The price will be $0.65 per Warrant Share in the third and four years following issuance.

Funding for the future

Although a well-capitalized airline, Canada Jetlines would still need long-term financing to advance its take-off run and secure its position as an operational airline.

In March, the airline successfully passed Stage 1 of a two-part certification process required before receiving an air services operator license from Transport Canada. For Stage 2, Canada Jetlines will need to demonstrate that they have the mandatory funding required to fund themselves for at least 90 days.

As such, the net proceeds of the offering will be used to advance the Canadian airline’s licensing process and other general corporate and working capital objectives.

Other examples would include the creative innovation of a state-of-the-art online booking platform. Canada Jetlines hopes to generate revenue from bookings and ancillary sales and training required for future crew and aircraft acquisition.

The financing capital is an essential next step in helping Canada Jetlines continue on its path to obtaining its air operator certificate from Transport Canada. Photo: Canada Jetlines

Almost cleared to take off

Once funding is received and the airline passes Stage 2, it will receive its permit to begin commercial aircraft operations and take-off after nearly a decade.

The crucial next step would be to choose a home base, and Canadian Jetlines has chosen Toronto Pearson International Airport as its central hub, much to the delight of Janik Reigate, Director of Strategic Customer Relations, Greater Toronto Airports Authority, as she said :

“We look forward to welcoming Canada Jetlines to the Toronto Pearson family. Airline activity at Toronto Pearson drives regional, provincial and national economic growth, and as we look to a brighter future as travel restrictions continue to ease, new partnerships like this will be key to driving post-pandemic recovery in Canada.

The Canadian carrier has set its sights on international departures across Canada, the Caribbean, Mexico, the United States and domestic cities from its newly chosen central hub.

Canada Jetlines aims to provide the best operating economy, passenger comfort and electric flight technology, delivering a passenger-centric experience from the first point of contact. Photo: Canada Jetlines

When a busy airport like Toronto Pearson is paired with a new airline operating a leisure-oriented business model, there’s a good chance of good passenger numbers – as Eddy Doyle enthused, Airline CEO:

“We are naming Toronto Pearson our primary travel hub, in preparation for summer service. This partnership will allow us to better serve domestic and international travelers to and from Canada’s busiest airport. We are optimistic about the future of Canada Jetlines and aim to strengthen the aviation industry in Toronto and beyond, increasing job opportunities and economic growth in the region. »

In addition, the airline is planning a fleet of aircraft from the Airbus family, starting with the Airbus A320. Canada Jetlines expects its fleet to grow to 15 aircraft by 2025.

At the end of the line

The private placement will undoubtedly help Canadian Jetlines pass Stage 2 of its two-part audit with Transport Canada. And with an Airbus A320 already in its fleet, the airline is undoubtedly very ready.

Although no route has yet been announced, it would be interesting to see which city Canadian Jetlines is heading to first. Would the airline play it safe and announce a domestic city, or play a bold move and announce an international city?

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