Aimia Inc. is poised to enter a new era in 2014 with TD Bank as its new partner and long-standing ally CIBC both offering credit cards linked to Aimia’s Aeroplan rewards.
However, current customers of CIBC Aerogold Visa cards won’t initially see any change and the companies are saying it won’t be until mid-2014 until the transition is completed.
Under an interim agreement between the two banks, CIBC will continue to process the accounts until new TD cards are issued to about half a million affected customers.
The trio of companies announced Friday that they have completed a previously announced deal that enables CIBC to retain about half of its porfolio of Aeroplan customers.
TD becomes the primary issuer of new Aeroplan Visa cards for the next 10 years, and it will acquire the half of the CIBC Aerogold customer base that doesn’t have broader banking relationships.
“The successful completion of this transaction puts Aimia in a unique place, working alongside strong financial services partners and Air Canada to shape what the future can look like for coalition loyalty,” said Rupert Duchesne, group chief executive for Aimia.
“The increased engagement of our members and our partners as we introduce a market leading program will be at the heart of what will drive our growth.”
Aimia had originally decided to switch its allegiance to TD Bank from CIBC at the end of its latest 10-year agreement, which expires on Dec. 31.
However, CIBC protested and eventually the three companies arrived at a compromise, announced in September — three weeks after the first deal was announced on Aug. 26.
A total of $312.5 million, plus the value of related outstanding card receivables, will be paid to CIBC, including $150 million from Montreal-based Aimia.
Aimia said Friday that current CIBC Aerogold Visa cardholders will receive a letter from the bank in January informing them whether their account will stay where it is or transition to TD in mid-2014.
Cardholders with accounts moving to TD will also receive a letter from TD in January providing them with more information about the transition.