GN declines option to buy minority stake in Canadian North
Territory decides it can meet air service goals in other ways
The Government of Nunavut has decided not to exercise its option to buy a minority stake in Canadian North, saying it can achieve its air transportation goals without an equity investment. (File photo)
The Government of Nunavut will not become a minority owner of Canadian North after concluding it can meet its air transportation objectives without purchasing an equity stake in the airline.
The decision, announced by the GN in a Wednesday news release, ends a year-long review of an option negotiated as part of the territory’s 10-year Commercial Airline Travel Services Agreement with Winnipeg-based Exchange Income Corp.
In its statement, the government said it found that providing “reliable, affordable, transparent, and sustainable air services” for Nunavummiut can be achieved in other ways.
Exchange Income Corp., which owns Canadian North, bought the company from Makivvik Corp. and Inuvialuit Regional Corp. for $205 million in February 2025.
The option for the GN to buy in was negotiated when the agreement was signed last July. The government had one year to decide whether buying a minority interest in the airline would help advance the territory’s long-term transportation goals.
Premier John Main declined to comment on this story. Transportation and Infrastructure Minister George Hickes was unavailable.
The decision does not affect the existing 10-year agreement, which covers government-funded medical travel, family services travel, duty travel and freight services throughout Nunavut, the release said.
The government also said it will work with Exchange Income Corp. to improve the air transportation in Nunavut.
“This speaks to the trust the Government of Nunavut has in EIC to deliver this essential service to their constituents,” the company said in a statement Wednesday.
Finally, the GN made a correct decision. Is this the twilight zone? This just cannot be true.
Joking aside, regardless of what some might believe. Owning a piece of the airline has no real upside benefit to Nunavummiut. Especially not Canadian North (CN). Any stake would be far too small (unless 50+1%) to effectuate real change or impacts. And no one wants the GN to own 50+1% of anything.
They were never going to get that anyways from the publicly traded company that now owns CN (Exchange Income Corporation (EIC)). For far too long, this airline (even with the previous owners) has had a choke hold on Nunavummiut and the North and for far too long the GN has sat idly by while it capitalized on this. Owning a “stake” would result in nothing in increased benefit to Nunavummiut and spending of taxpayer dollars worthlessly (there is already enough of that). No, ticket costs would not have come down, and no, operations would not have improved. Let’s be honest, the GN improving operations. Laughable. Also love the comment from EIC, quote, “This speaks to the trust the Government of Nunavut has in EIC to deliver this essential service to their constituents”. “Trust” is not a word you use when there are no other players to determine where “trust” is generally earned on measurable performance and service delivery. Their use of the word “trust” in this case can be replaced by “obligation”.
Will this capitalization on the backs of travelers continue? Of course it will! Up until the GN does something like govern and take steps to increase the likelihood that additional competition might see the value in doing business in the North. As it stands now, the GN will ride its 10-year agreement and will do little to nothing to try and set the stage for future competition and the lowering of airfares or improving service.
It is true that no one is banging down the door to fly into Nunavut communities. That is absolutely true. It’s a tough place to be in the airline business. Add to this that Airport Infrastructure improvements have occurred but at a snail’s pace and much more will be required to ever create an “environment” where some other operator might look at Nunavut as a good place to do business. Hopefully over time, steps will occur to permit a more interesting and competitive business environment.
It will be hard to tell however what the GN is thinking and what it plans to try and do to improve air services in Nunavut. Given the attitude of this new government. It seems, “out with the old, in with the new”, was lost on some or most of the recently (9 months ago) elected members of the 7th Assembly. Now that he has become Premier, he seems unable to make comments (for this article, quote, “Premier John Main declined to comment on this story”). Or make comments, articulate a position, define an idea or describe a plan for the many other major issues (i.e. Nutrition North Report, Baffinland, Housing, Health, etc, etc,,) facing Nunavummiut. So much for transparency. Right Mr. Premier?
So, for now, see some of you on your next, excessively expensive, flight down south on Canadian North.
I see this as a lost opportunity for the GN.
Being a minority owner, and one that provides a huge share of the company’s revenue gives you tremendous leverage to effect changes to policy. It not only gets you a seat at the boardroom table, it gets you the chair next to the CEO and beside the VP of Finance.
The GN has always leverage, and they used to play off Canadian North vs First Air to get what they wanted. Since the merger that tactic is obsolete. The GN knows (or should know) that competition is not likely. So what is the GN plan?
Taking an ownership stake would have been a great opportunity to work with EIC to provide safe, reliable, and cost effective air transportation to the people and businesses of Nunavut. Now?
Somethings got to be done about this. They take all the deals we get in food. I went to Yellowknife, with a second bag assuming id save a lot with the trip. It was like whatever deal I got was taken by the airlines in their overage fee, or second bag charges. Its not right.