Dividends Put On Hold By Aimia

Aimia Inc will be suspending all dividends on both common and selective shares instantaneously, together with in advance admitted payments that were to be taken care of at the latter part of this month.

The corporation, located in Montreal, manages Aeroplan and further compensation programs for different firms, with Air Canada being their unique client. According to Aimia, the suspension of the dividend is necessitated as a result of the decision to put a ban on the usage of Aeroplan by Air Canada. Thus, host its own reward program in 202 for their customers.

This information caused Aimia’s shares to decline drastically, with stocks closing at $1.89, which is less than the one-quarter that were worth before the 10th of last month. After the news about the holdup of the dividend was made public, stocks went down more than 19 per cent, plummeting to $1.53 of 36 cents.

A lessening of funds test which is needed by the Canada Business Corporations Act will have them be an exclusion towards paying the dividends according to Aimia, in spite of what the liquidity will do for them. Robert Brown said in a statement; “Our business continues to thrive well and generates strong free cash flow.” In the future, shareholders who are qualified to past stated dividends may be paid for.

After Air Canada leaves, Aimia is scheduling on building new long-term relationships during that time and also have $70 million worth of cost cut down from its firm. The number of board directors will also be abridged to nine members. For the time being, the directors assigned will be Beth Horowitz, Joanne Ferstman and Alan Rossy.

J C Loum