AIM.TO - Aimia

[petec]

This has been my third largest position. I'm considering that my best option is to hold the shares for now.

 

Well done you. I'm regretting selling my prefs at a small gain but you can't win them all.

[Homestead31]

i think this is a very good risk reward as the bid for Aeroplan is likely to be increased.

 

Aeroplan has 5 million members.  A $250M bid implies a value of $50 per member.

 

it costs WAY more than that for banks etc to get new credit card users, and that is just to get them to sign up.  then you have to get them to actually use the card, which will be a high hurdle since Aeroplan will still be running in 2020 in some form w/ redemption options at many airlines including Air Canada, and nobody likes to leave old miles stranded, and nobody likes to go through and change the autopayments stuff they have set on their existing credit card.

 

google around a bit and you will see estimates of anywhere from $250-$1000 per card for acquisition costs.  That includes advertising (cost per click etc) as well as the cost of the signup bonus, which is often miles.  Clearly in this case the cost of signup bonus will be lower b/c miles wont be purchased at market rates, and even advertising costs will be lower b/c they can just have stewardesses walk the aisles of their flights with sign up info etc. 

 

at the same time, that $250-$1000 estimate does not include having to build out the technology to run the program, and the people to run it.

 

It also does not include the value that comes with having a record of past purchasing behavior, which can help you price flights appropriately going forward.

 

it also does not include whatever reputational damage can be avoided by just keeping aeroplan members happy and loyal to air canada rather than making them jump through hoops etc.

 

All in all, $50 per member is very very low, and it is not hard to guestimate that the number should be much much higher even after figuring the lower cost of signup bonuses etc.

 

My bet is that Aimia will come back and say it is too low, the bid will be raised, and ultimately accepted.  I don't think they will get Mittleman's estimate of $1B, but Mittleman bros have had a tough run in recent years, and would likely be happy with something in between $250M and $1B.  even if it is only $350M (super low $70 customer acquisition cost) that is an additional 20% upside from here, and air canada would be crazy to not just buy this customer list rather than trying to build their own.  They could pay $500 and still come way way way ahead of their own estimate of a $2.5B net present value of their own loyalty program that they haven't even built yet.

 

[Cigarbutt]

i think this is a very good risk reward as the bid for Aeroplan is likely to be increased.

 

Aeroplan has 5 million members.  A $250M bid implies a value of $50 per member.

 

So there is progress but the story continues to be an attempt at a compromise between 2 very different assessments.

1-The assessment made by Air Canada, as anchor partner.

2-The assessment made by those who think that Aimia has a profitable operating future without an anchor airline partner.

My valuation range has always been much closer to 1-

 

Homestead,

In your evaluation, why do you take the $250M amount and not enterprise value ($2,25B) to derive your acquisition cost measure?

 

This is work in progress but isn't it interesting that the point liabilities assumed (deferred revenue) by AC under present circumstances would correspond only to about 2/3 of deferred revenue recognized in the Aeroplan program? Looking back at what happened to Nectar and trying to figure out the accounting (and cash flow) implications for the Aeroplan program and Aimia, I estimate that, if that's part of the negotiations, if AC eventually assumes the other 1/3 of redemption liability, that would require Aimia to transfer about $600M (estimated redemption cost) to Air Canada as a related cash coverage transfer. So, I agree with bizaro86 that the "go it alone" option is still alive.

 

Another message I get from the press release is that TD, CIBC and Visa may very well follow the loyalty program (whatever it is) that has Air Canada as an anchor partner.

 

Negotiations are likely but I still see AC having the upper hand and, to me, this has implications for valuation along the capital structure.

 

@Petec if you made it this far:

Say you were still holding prefs this AM, what would you do with the new info?

 

@bathtime

Holding shares makes sense because there is value in Aimia that is not reflected in presently quoted market cap. The problem I've always had here is that I could never really put a price tag on the value destruction that would occur. Maybe Mr. Mittleman and Mr. Rovinescu can make a satisfactory deal but I don't know enough about the two personalities to commit capital here. Good luck (sincerely).

 

[ulysses02]

i think this is a very good risk reward as the bid for Aeroplan is likely to be increased.

 

Aeroplan has 5 million members.  A $250M bid implies a value of $50 per member.

 

So there is progress but the story continues to be an attempt at a compromise between 2 very different assessments.

1-The assessment made by Air Canada, as anchor partner.

2-The assessment made by those who think that Aimia has a profitable operating future without an anchor airline partner.

My valuation range has always been much closer to 1-

 

Homestead,

In your evaluation, why do you take the $250M amount and not enterprise value ($2,25B) to derive your acquisition cost measure?

 

This is work in progress but isn't it interesting that the point liabilities assumed (deferred revenue) by AC under present circumstances would correspond only to about 2/3 of deferred revenue recognized in the Aeroplan program? Looking back at what happened to Nectar and trying to figure out the accounting (and cash flow) implications for the Aeroplan program and Aimia, I estimate that, if that's part of the negotiations, if AC eventually assumes the other 1/3 of redemption liability, that would require Aimia to transfer about $600M (estimated redemption cost) to Air Canada as a related cash coverage transfer. So, I agree with bizaro86 that the "go it alone" option is still alive.

 

Another message I get from the press release is that TD, CIBC and Visa may very well follow the loyalty program (whatever it is) that has Air Canada as an anchor partner.

 

Negotiations are likely but I still see AC having the upper hand and, to me, this has implications for valuation along the capital structure.

 

@Petec if you made it this far:

Say you were still holding prefs this AM, what would you do with the new info?

 

@bathtime

Holding shares makes sense because there is value in Aimia that is not reflected in presently quoted market cap. The problem I've always had here is that I could never really put a price tag on the value destruction that would occur. Maybe Mr. Mittleman and Mr. Rovinescu can make a satisfactory deal but I don't know enough about the two personalities to commit capital here. Good luck (sincerely).

 

$2.25B would be suggesting that acquirer is "paying" for the redemption cost liability which is merely deferred revenue that is only immediately due under very specific circumstances e.g. run-off or potentially, receivership. It may make sense, however, to attach the ~$350M net debt figure to the Aeroplan offer equity value, so EV of $600M against 5M member, or $120 per member, which is still cheap. 

[bizaro86]

You should at least include a present value of the miles earned in the acquisition figure. Those miles will get redeemed for something of value at some point, and any acquirer will have to pay for that something of value somehow.

 

Also, is your assumption that: number of members == number of credit card accounts, or is that the number of active credit card accounts?

 

I only ask because members will be much larger than credit cards for a few reasons. I'm an aeroplan member, as is my wife, as are my children. My pre-school aged children aren't good candidates for marketing credit cards. I have an inactive TD one that I cancelled a couple of years ago (signed up for bonus). They have been sending me statements marked "inactive" for years inviting me to call to reactivate. I haven't used it or paid a fee in that time, so I doubt I have much value as a customer there. My wife has a cash back card and no interest in an aeroplan card whatsoever, but just redeems miles earned from flying.

[Cigarbutt]

You should at least include a present value of the miles earned in the acquisition figure. Those miles will get redeemed for something of value at some point, and any acquirer will have to pay for that something of value somehow.

 

Agree that there is a time value and, even if the deferred revenue has a built-in accounting profit part, over time recognizing deferred revenue has a negative cash flow component.

 

Also, like Mr. Mittleman describes, it is "normal" for loyalty businesses to record deferred revenue and it is OK to associate this concept with negative working capital requirements, but the underlying assumption implies that not only there is going concern but also that the business generating points will continue at comparable or better levels (otherwise the potential negative cashflow implications are very real). I think that it is fair to assume that Aeroplan with Air Canada meets that definition versus the uncertainty of Aeroplan continuing without an airline anchor partner. I don't think that deferred revenue has zero value in Aimia's present context. There is a range of value depending on the perspective.

 

So, the interesting part IMO is that the value of this liability is lower for Air Canada as a potential acquirer of Aimia versus for Aimia as a stand-alone entity. Potential area for negotiation.

 

Also, I understand that AC does not intend to assume Aimia's debt from today's press release.

[Homestead31]

i think this is a very good risk reward as the bid for Aeroplan is likely to be increased.

 

Aeroplan has 5 million members.  A $250M bid implies a value of $50 per member.

 

 

 

Homestead,

In your evaluation, why do you take the $250M amount and not enterprise value ($2,25B) to derive your acquisition cost measure?

 

 

 

short answer, i agree with mittleman's points.  industry standard in M&A is to not count the liability.

 

longer answer is more complicated and ephemeral, but basically, the $2B is a GAAP liability, but to an airline, it is more of an asset.  planes fly whether they are full or not.  for an airline, there is essentially zero dollar cost to redeem the miles. they may have an accounting book entry for the "cost" of the miles, and  if you want to split hairs, the dollar cost is an extra bag of peanuts and a thimble full of jet fuel....  but the key takeaway is that b/c the cost of flying the plane is fixed, there is zero dollar cost to having another body on board. 

 

the asset is that if you get an extra person on a plane b/c they used their miles, and then they feel good about your airline and are more likely to fly with you again, that has value. that is why it is called a loyalty program.  there is also (small) value if they are on your plane and buy a drink and a sandwich or whatever.  its not worth putting a dollar number on that, but the real cost is certainly zero b/c the airline is flying that plane one way or another.

[Cigarbutt]

Homestead,

In your evaluation, why do you take the $250M amount and not enterprise value ($2,25B) to derive your acquisition cost measure?

 

short answer, i agree with mittleman's points.  industry standard in M&A is to not count the liability.

 

longer answer is more complicated and ephemeral, but basically, the $2B is a GAAP liability, but to an airline, it is more of an asset.  planes fly whether they are full or not.  for an airline, there is essentially zero dollar cost to redeem the miles. they may have an accounting book entry for the "cost" of the miles, and  if you want to split hairs, the dollar cost is an extra bag of peanuts and a thimble full of jet fuel....  but the key takeaway is that b/c the cost of flying the plane is fixed, there is zero dollar cost to having another body on board. 

 

the asset is that if you get an extra person on a plane b/c they used their miles, and then they feel good about your airline and are more likely to fly with you again, that has value. that is why it is called a loyalty program.  there is also (small) value if they are on your plane and buy a drink and a sandwich or whatever.  its not worth putting a dollar number on that, but the real cost is certainly zero b/c the airline is flying that plane one way or another.

 

Thank you. Still, with the perspective you describe, one needs to assume a perfect match between would-have-been-empty seats and tickets sold through the reward channel.

 

It's always challenging to value liabilities in a distress scenario and now vultures are circling:

https://www.prnewswire.com/news-releases/grupo-aeromexico-announces-offer-to-acquire-aimias-stake-in-plm-300687112.html

 

"It merits mentioning that Aeromexico has informed Aimia that the current contract between PLM and Grupo Aeromexico ("Aeromexico"), that establishes the basis of operation for the loyalty program Club Premier, will not be extended beyond its current expiration date.

 

Given the long-term intention of Aeromexico to take full control of its loyalty program, Aeromexico does not consider an IPO of PLM as an acceptable option. For this reason it is Aeromexico's view that the best long term solution for all stakeholders is for Aeromexico to acquire the equity stake currently held by Aimia."

 

It's hard not to see this choreography as a concerted effort to go for the jugular.

 

[StubbleJumper]

i think this is a very good risk reward as the bid for Aeroplan is likely to be increased.

 

Aeroplan has 5 million members.  A $250M bid implies a value of $50 per member.

 

 

 

Homestead,

In your evaluation, why do you take the $250M amount and not enterprise value ($2,25B) to derive your acquisition cost measure?

 

 

 

short answer, i agree with mittleman's points.  industry standard in M&A is to not count the liability.

 

longer answer is more complicated and ephemeral, but basically, the $2B is a GAAP liability, but to an airline, it is more of an asset.  planes fly whether they are full or not.  for an airline, there is essentially zero dollar cost to redeem the miles. they may have an accounting book entry for the "cost" of the miles, and  if you want to split hairs, the dollar cost is an extra bag of peanuts and a thimble full of jet fuel....  but the key takeaway is that b/c the cost of flying the plane is fixed, there is zero dollar cost to having another body on board. 

 

the asset is that if you get an extra person on a plane b/c they used their miles, and then they feel good about your airline and are more likely to fly with you again, that has value. that is why it is called a loyalty program.  there is also (small) value if they are on your plane and buy a drink and a sandwich or whatever.  its not worth putting a dollar number on that, but the real cost is certainly zero b/c the airline is flying that plane one way or another.

 

 

 

Well, the short answer is fine as long as your loyalty program remains a going concern.  Annual redemptions are offset by issuance of points/miles and the accumulated reward liability is largely irrelevant.  But that's only true if the program is viable for the foreseeable future and a bulk of its participants don't collectively decide to rush to the exits.  When AC made its announcement last summer, the viability of Aeroplan as a going concern became a real question.  We've already seen an uptick in net-redemptions, but so far it hasn't been catastrophic.

 

The longer answer doesn't hold water for me.  With Aeroplan, people are not booking empty seats at the last minute, they usually book them well in advance -- in fact, that's one of participants' biggest beefs with the program, that they need to book their tickets six months in advance to get a reward booking.  Further, AC's flights rarely have empty seats these days (in my experience this is also true of UA and Lufthansa -- they are doing a much better job of managing their load and pricing their seats to fill the planes).  An Aeroplan seat is not a "freebie" for an airline, but rather a seat that they can no longer sell to a cash paying customer.  I would, however, fully buy your argument if AC and other airlines used their FF programs to fill the last few seats on a plane at the last minute, but that's just not how it works.

 

The stink-bid from AC is a lifeline for AIM shareholders and it's a lifeline for Aeroplan program participants.  If the takeover fails and AC ultimately does elect to start its own FF program, you can expect a bulk of customers to migrate away from Aeroplan toward the new Star Alliance eligible program.  If they all try to redeem their existing Aeropesos after migrating, then that reward liability becomes real.

 

 

SJ

[mcliu]

I don't see why they would increase the bid for Aeroplan. There's no other logical buyer. The value of Aeroplan is 0 or negative if it continues under Aimia. $250M seems generous..

[bathtime]

https://business.financialpost.com/pmn/business-pmn/grupo-aeromexico-makes-us180-million-offer-to-buy-aimias-stake-in-plm

 

"Grupo Aeromexico makes US$180 million offer to buy Aimia's stake in PLM."

 

Mittleman:

 

"PLM Premier (Mexico): ownership (48.9%), est. fair value = US$489M, 10x US$100M EBITDA est. 2019 = US$3.21 per share 5.3M members in fast growing coalition loyalty program anchored by Aeromexico, Mexico’s flagship airline.

Aimia invested US$124M for a 48.9% stake between 2010-2012, and since then received US$84M in cash dividends.

At last financing round in 2012, PLM total enterprise was valued at US$518M, and it has grown substantially since then. Comps are Smiles Fidelidade S.A. (SMLS3 BZ) and Multiplus S.A. (MPLU3 BZ) and trade at 8x to 6x EBITDA recently, down sharply in emerging market sell-off, but fair value likely closer to 10x EBITDA for both."

 

Mittleman as a board member already would have known about the Air Canada approach before his Q2 Letter was released detailing his sum of the parts.

 

What Air Canada hadn't planned for is that a value activist like Mittleman would be able to obtain not only board representation but install a highly reputable CEO from the industry which then will have made Aimia's viability as a going concern and as a potentially strong competitor beyond 2020 much more realistic.

 

See Rabe video, he's a creative and skilled leader, whereas former CEO was incompetent: https://www.youtube.com/watch?v=YO8HB1iwUvQ

 

 

 

 

[CleverLongboat]

I don't know what the market is pricing in here but a relatively simple NAV using the Air Canada and Aero Mexico bid and subtracting debt and prefs gets me to about $1.00CAD in value per share. Why are Aimia and the prefs up so much? If anything like that comes to pass, shareholders might end up fighting pref holders for liquidation value...

[clutch]

I don't know what the market is pricing in here but a relatively simple NAV using the Air Canada and Aero Mexico bid and subtracting debt and prefs gets me to about $1.00CAD in value per share. Why are Aimia and the prefs up so much? If anything like that comes to pass, shareholders might end up fighting pref holders for liquidation value...

 

https://business.financialpost.com/news/fp-street/air-canada-td-bank-cibc-visa-offer-to-buy-aimia-aero

 

Air Canada’s bidding group, which also includes Toronto-Dominion Bank and Canadian Imperial Bank of Commerce as well as Visa’s Canada unit, said in a statement it would also assume the liability of about $2 billion in Aeroplan points. The offer implies an estimated market value of $3.64 per Aimia share, a 46 per cent premium to its closing price of $2.50 Tuesday, the bidders said.

 

[CleverLongboat]

Yeah but the asset side of the balance sheet is full of intangibles that go away with Aeroplan etc.

Here is what I'm approximately getting assuming liquidation and current bids go through as is:

Liquidation Value

Cash 272

Restricted Cash 16

Short & LT term Investments 275

Prepaid expenses 29

Property 18

Think Big 60

Cardlytics 60

Aeroplan 250

PLM 235

Assets 1215

AP & Accrued 100

Income Taxes 14

LTD 350

Pension 100

Deferred Income Tax 93

Preferreds 322.5

Corporate Costs for 2 years 120

Liabilities 1099.5

Equity 115.5

Shares 152

Value/Share 0.76

 

[Saj]

Yeah but the asset side of the balance sheet is full of intangibles that go away with Aeroplan etc.

Here is what I'm approximately getting assuming liquidation and current bids go through as is:

Liquidation Value

Cash 272

Restricted Cash 16

Short & LT term Investments 275

Prepaid expenses 29

Property 18

Think Big 60

Cardlytics 60

Aeroplan 250

PLM 235

Assets 1215

AP & Accrued 100

Income Taxes 14

LTD 350

Pension 100

Deferred Income Tax 93

Preferreds 322.5

Corporate Costs for 2 years 120

Liabilities 1099.5

Equity 115.5

Shares 152

Value/Share 0.76

 

Thanks for sharing.

 

I view these offers as floors, not ceilings. Aimia has no obligation to sell, particularly in the PLM case, which runs for another dozen years. Perhaps with its own charters or other partners or better offers for these same assets, Aimia can be worth much more. Furthermore, they continue to generate cash while we wait.

 

I own the prefs, and continue to hold on since IMO these are worth close to face value.

 

Just my two cents since you asked what the market may be thinking.

 

Saj

[CleverLongboat]

Saj, good points. I agree, especially the value of PLM seems to be up in the air at this point.

[ulysses02]

CleverLongboat -- Aeroplan's bid is a going-concern -- and not a liquidation -- bid at $3.64 per share. They've merely used a SOTP style breakdown in their letter of intent. The value of Aeroplan to Air Canada is the cost savings to building their own program, the increased loyalty and hence turnover on their assets and the share of value of 5M members to coalition partners.

 

Your NAV breakdown is effectively a liquidation assessment. Any business valued on a liquidation basis would look overpriced relative to an arms-length enterprise value bid..

[Homestead31]

lets also not forget that WestJet has very recently announced a major expansion, as well as a reboot of their own loyalty program. 

 

If Aimia were to go belly up, Air Canada must realize that there is a very real risk that they won't simply pick up the pieces... WestJet will be fighting for them tooth and nail.  Air Canada would be crazy if they took on all of the cost of acquiring customers (head to head vs WestJet), all of the operational risk of building something that works, and all of the time (a few years) required to build something new when WestJet is looking to poach customers now.

 

air canada has plenty of room to the upside on their bid that would STILL cost less and have way less risk than starting from scratch.

 

The PLM bid is just silly.  The growing dividend stream over the next 12 years is worth more than the bid.

 

however, PLM smelled blood in the water, and all they need is one shareholder to make noise about demanding a vote etc., and then air canada and aeromexico will wind up stealing the pieces... but at least the theft will occur higher than current prices

[Cigarbutt]

air canada has plenty of room to the upside on their bid that would STILL cost less and have way less risk than starting from scratch.

 

I find it difficult to figure out odds of a compromise here. They seem to be so far apart.

 

-What do you mean by plenty of room?

My take on the situation is that AC, at this point, will not go much higher.

 

-Can you or others comment on (if a deal is reached) what would be transferred (or not) on what is remaining in the related items of the Aeroplan subsidiary assets and liabilities (mainly about $560M in cash, ST and LT investments and about $1B in deferred revenue) that need to be considered along the sale of the business?

Aeroplan is not Nectar but I'm asking because this part happened to be significant, in terms of cash flow implications (along working capital adjustments). I wonder if the acquisition of the cash flow generation from now to June 2020 could partially mitigate this component of the transaction?

 

[bizaro86]

This is interesting. There has been a noticeable improvement in the Aeroplan strategy and communication since the new CEO came on board. Before the messaging was roughly "you'll still be able to get flights"

 

Now the messaging is "you'll be able to use any airline, the reward chart will be mostly the same, and we're running charters for peak dates that you can't get now to popular destinations, plus you'll be able to transfer to hotel programs"

 

Way more attractive, and will probably slow the burn to 2020, improving cash-flow in the interim. That, plus customer inertia on the credit card side probably means the going concern value of Aeroplan is more than what Air Canada has offered, especially if you assume they do a few devaluations over time to cut down that big deferred liability.

[petec]

@Petec if you made it this far:

Say you were still holding prefs this AM, what would you do with the new info?

 

I'd have sold them immediately, on three grounds:

1) My original buy thesis was that they were vastly undervalued if AC renewed and probably undervalued if it did not. Making what would have been a >70% profit in the event that AC did not renew, which is what would have happened had I sold recently at $18, would have been a huge and unexpected win.

2) My assessment of intrinsic value was accurate enough to know that $10 was not the right price, but it was not accurate enough to know whether $18 is.

3) These are prefs, not common. Their price is determined by two things: creditworthiness and interest rates. This bid should have laid the creditworthiness worries to rest immediately*. I see no particular reason to see why a higher bid would add value to the prefs (as opposed to the common). So the only reason to hold would be for the income, and on that basis the prefs at $18 look fine to me but not exciting. The only reason to expect another big bump upwards is if the new owners redeem the prefs, but I have no view on how likely that is.

 

P

 

*EDIT: this may not be right. I was thinking the bid was for the company, and therefore the prefs would become liabilities of a new entity with a very cash-positive future. But if the bid is just for Aeroplan, then to assess the creditworthiness of the prefs I'd have to redo a SOTP for the remainder of Aimia, which I have not done.

[petec]

One other thought on the value of the customers and on customer acquisition costs. We, or at least I, don't know how much data AC and TD have on Aeroplan members. It is possible that Aeroplan runs the points system but that actually the majority of the useful data is available to the partners. I can't believe AC doesn't know who's flying on their planes and TD doesn't know who has their credit cards. That's not to say that Aeroplan doesn't have valuable data, but AC and TD are buying customers that they already have and know. The customer acquisition cost equivalence therefore doesn't hold water for me. The true value is avoiding the cost of rebuilding the platform and the disruption to customers.

[StubbleJumper]

One other thought on the value of the customers and on customer acquisition costs. We, or at least I, don't know how much data AC and TD have on Aeroplan members. It is possible that Aeroplan runs the points system but that actually the majority of the useful data is available to the partners. I can't believe AC doesn't know who's flying on their planes and TD doesn't know who has their credit cards. That's not to say that Aeroplan doesn't have valuable data, but AC and TD are buying customers that they already have and know. The customer acquisition cost equivalence therefore doesn't hold water for me. The true value is avoiding the cost of rebuilding the platform and the disruption to customers.

 

 

AC absolutely does know who is flying on their planes.  But, in a country of 35 million people, there are probably 287 Xiu Li's, 116 Sam Jones's, and 73 Hussein Ali's (we do not have a national identity card system in Canada -- the government can go F itself if it wants us to carry ID on a day-to-day basis).  The nice thing about Aeroplan is that there is a unique identifier number which enables analysis of individuals travel habits, which cannot be done with names alone.  The other nice thing about Aeroplan's granular data is that it tells you what hotels people use, where (and whether) they purchase fuel for their car, and whether they visit particular grocery stores or pharmacies.

 

The data exists, its granular, and it's worth something.  But how much?

 

 

SJ

[bathtime]

I wonder what the bolded part is referring to? Air Canada's proposals or other parties?

 

https://www.aircanada.com/ca/en/aco/home/frequent-flyer/questions.html

 

Q: Why are you giving Aimia a week to respond? Why can’t you give them more time?

A: As previously announced, Air Canada is launching a new loyalty program in June 2020. In order to do this, we need to define our core program partners well in advance to ensure that we have enough time to build a best in class loyalty program.

What’s more, there have been other proposed transactions to purchase Aimia over the past several months. Given the stability and certainty that this bid ensures for our customers and all Aeroplan members, it’s important and necessary to come to a conclusion on this bid quickly.

[petec]

 

AC absolutely does know who is flying on their planes.  But, in a country of 35 million people, there are probably 287 Xiu Li's, 116 Sam Jones's, and 73 Hussein Ali's (we do not have a national identity card system in Canada -- the government can go F itself if it wants us to carry ID on a day-to-day basis).  The nice thing about Aeroplan is that there is a unique identifier number which enables analysis of individuals travel habits, which cannot be done with names alone.  The other nice thing about Aeroplan's granular data is that it tells you what hotels people use, where (and whether) they purchase fuel for their car, and whether they visit particular grocery stores or pharmacies.

 

The data exists, its granular, and it's worth something.  But how much?

 

SJ

 

Yes, it is worth something. But what I have never been able to figure out is exactly who owns what, data-wise. For example, does AC have the rights to all the data generated by AC and TD to all the data generated by TD? And if so, could they not replicate almost exactly what Aeroplan has by putting their heads together? I don't know the answer to this but these questions have always prevented me from being confident in the value I ascribe to Aeroplan.

 

Incidentally, in my experience you can't fly without giving your passport number, so there's a unique identifier.