Under the terms of the deal, Aeroplan will become a partner in American Express' Membership Rewards program and the two companies will work together to develop a range of co-branded charge cards for consumers and corporations.

American Express, Air Canada and Aeroplan have signed a letter of intent. The deal is subject to definitive agreements and approval of the court overseeing Air Canada's restructuring.

“We are delighted that Air Canada sees us as the right partner for Aeroplan,” said Beth Horowitz, president and general manager, Amex Bank of Canada.

“We have the ability to drive aggressive growth and deliver significant long-term value to Air Canada. American Express will be a powerful marketing partner both here in Canada and also in key international markets. We will promote Aeroplan through our existing Membership Rewards program and through developing compelling new products that will have a strong appeal to consumers and business customers.”

In addition to purchasing miles from Aeroplan, American Express will also invest considerable resources to develop and market co-branded Aeroplan charge card products.

The Aeroplan deal will further strengthen the strategic relationship between American Express and Air Canada. Air Canada is one of American Express' largest card merchant partners, and American Express is the airline's largest travel agency.

The opportunity to further leverage American Express' leadership in the corporate and government services market, in addition to the high spending consumer segment, presents a unique growth opportunity for both companies.

Horowitz added that strategic partnerships have been fundamental to American Express' growth strategy in Canada. The Company markets highly successful co-branded products with AIR MILES and Costco Wholesale.

“With the addition of Aeroplan, we believe we will have an unbeatable portfolio of products that will give our customers the best choices in the marketplace,” said Horowitz.

American Express in Canada operates as American Express Bank of Canada and American Express Canada Inc. Both are wholly owned subsidiaries of the New York based American Express Travel Related Services Company, Inc., the largest operating unit of the American Express Company. Amex Bank of Canada is the issuer of American Express Cards in Canada. Amex Canada Inc. operates the Corporate Travel, Consulting, Travel Services Network and Travellers Cheque divisions in Canada. American Express opened its first offices in Toronto and Hamilton in 1853 and now about employees 3,700 Canadians coast-to-coast.

American Express Company is a diversified worldwide travel, financial and network services company founded in 1850. It is a world leader in charge and credit cards, Travelers Cheques, travel, financial planning, business services, insurance and international banking.