Delta and Korean Air Buy 25% Stake in WestJet

by Anthony Losanno
WestJet

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Delta Air Lines and Korean Air announced today that they have purchase a 25% stake in Canadian carrier, WestJet. The two airlines spent a combined $550 million (Delta at $330 million and 15% with Korean Air at $220 million and 10%). Delta and Korean Air have been codeshare partners with WestJet for a long time and this purchase is said to bring them even closer together and strengthen connectivity between Canada and North AmericaEurope and Asia, and beyond.

It’s nothing new for Delta Air Lines to buy stakes in other airlines. Currently, Delta owns a piece of Aeromexico, Air France-KLM, China Eastern, LATAM, Virgin Atlantic, and even Korean Air’s parent company known as Hanjin KAL. The minority equity stakes in this transaction were purchased from Onex Partners (who also own most of my former employer Emerald Expositions).

Korean Air A321neo

Delta and WestJet have been partners since February 2011. I have flown WestJet and love that I can credit the flights to my Delta SkyMiles® account. Korean Air and WestJet began their partnership in June 2012. Through a codeshare agreement, passengers can access flights between Seoul Incheon International Airport (ICN) and Vancouver International Airport (YVR)Toronto Pearson International Airport (YYZ), and Calgary International Airport (YYC) with onward connections to WestJet’s domestic Canadian and US routes as well as Korean Air’s extensive network in Asia.

This acquisition makes sense for all parties and keeps WestJet closely aligned with SkyTeam. I would not be shocked to see WestJet join the alliance in the future. Air Canada is a founding member of Star Alliance and closely tied to Lufthansa and United through it transatlantic joint venture (I don’t see that changing).

WestJet Delta

Delta CEO, Ed Bastian, said:

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. Together, Delta and our airline partners are connecting the world and transforming the future of travel.”

Walter Cho, Chairman and CEO of Korean Air and Hanjin Group, added:

We are pleased to invest in WestJet as part of our continued commitment to enhancing transpacific connectivity. This strategic partnership will enhance our global network and create long-term value for customers through greater choice and convenience.”

Anthony’s Take: This deal has no impact on current customers, but will hopefully see even closer connections in the future. What that means is still unknown, but I see this as a good move all around.

(Image Credits: Delta Air Lines, Korean Air, and WestJet.)

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Advertiser & Editorial Disclosure: The Bulkhead Seat earns an affiliate commission for anyone approved through the links above This compensation may impact how and where links appear on this site. We work to provide the best publicly available offers to our readers. We frequently update them, but this site does not include all available offers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed, or approved by any of these entities.

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