In a surprising move that reshapes Canada’s airline landscape, Toronto-based private equity giant Onex Corporation announced yesterday it’s selling minority stakes in WestJet to both Delta Air Lines and Korean Air for a combined $550 million. The deal keeps Onex as the controlling shareholder, but brings two international heavyweights into WestJet’s ownership structure at a critical time for the Canadian carrier.
“This strategic partnership strengthens WestJet’s position both domestically and internationally,” said Alexis von Hoensbroech, WestJet’s CEO, during a media call this morning. “It provides us with additional capital while creating deeper operational relationships with two world-class airlines.”
The transaction values WestJet at approximately $5.2 billion including debt – notably higher than the $5 billion Onex paid when it took the airline private in 2019. Delta will acquire an 8% stake while Korean Air will take 5%, with both stakes coming directly from Onex’s holdings rather than through newly issued shares.
For Canada’s aviation market, this represents one of the most significant ownership shifts since Air Canada’s privatization. Industry analysts see this as Onex capitalizing on post-pandemic recovery while ensuring WestJet gains stronger international partners.
“Onex is making a smart play,” explains Ambarish Chandra, professor of economic analysis at the University of Toronto. “They’re monetizing part of their investment at an attractive valuation while giving WestJet access to two powerful global networks and expertise.”
The timing is particularly noteworthy given recent statistics from Statistics Canada showing domestic air travel has recovered to 97% of pre-pandemic levels, with international routes showing even stronger growth at 105% compared to 2019 figures.
WestJet has faced intensifying competition from both discount carriers like Flair Airlines and established players expanding routes. The airline reported solid Q1 results last month with passenger revenue increasing 12% year-over-year, but still faces margin pressure from rising fuel and labor costs.
Delta’s investment continues its strategy of taking minority positions in key international partners. The Atlanta-based carrier already holds stakes in LATAM, Virgin Atlantic, and Aeromexico, forming what industry insiders call a “partnership of investments” approach rather than pursuing outright acquisitions.
“We see tremendous potential in the Canadian market and in WestJet specifically,” said Ed Bastian, Delta’s CEO. “This investment deepens our commitment to transborder travel and expands our reach for customers flying between North America and Asia through our partners.”
For Korean Air, this marks its first major North American airline investment and comes as it continues working through regulatory approvals for its acquisition of rival Asiana Airlines. The Seoul-based carrier stands to gain better access to Canadian destinations and smoother connections for passengers traveling between Asia and North America.
“WestJet offers excellent connectivity within Canada and to the United States,” noted Walter Cho, Korean Air’s Chairman. “This investment creates opportunities for both carriers to strengthen routes and enhance the customer experience across our combined networks.”
The deal includes codeshare expansions that will allow WestJet passengers to connect more seamlessly to Delta’s U.S. network and Korean Air’s Asia-Pacific routes. Frequent flyer program integration will also deepen, enabling WestJet Rewards members to earn and redeem points across all three carriers.
Behind the numbers lies a strategic recalibration for WestJet, which has oscillated between focusing on its low-cost roots and competing with Air Canada for premium business travelers. The airline has been steadily expanding its international footprint with flights to Europe and has significantly invested in its fleet, including new Boeing 787 Dreamliners for long-haul routes.
“This isn’t just about passive investment,” says airline industry consultant Robert Kokonis of AirTrav Inc. “The operational synergies with both Delta and Korean will help WestJ
