Groupe Aeroplan Inc. to Issue C$150 Million of Cumulative Rate Reset Preferred Shares

MONTREAL, QUEBEC--(Marketwire - Jan. 12, 2010) -

THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Groupe Aeroplan Inc. (TSX:AER) announced today that it has agreed to issue to a syndicate of underwriters led by CIBC World Markets Inc., RBC Dominion Securities Inc. and TD Securities Inc. as Co-Bookrunners for distribution to the public, 6.0 million cumulative rate reset Preferred Shares, Series 1 (the "Preferred Shares, Series 1"). The Preferred Shares, Series 1 will be issued at a price of C$25.00 per share, for aggregate gross proceeds of C$150 million. Holders of the Preferred Shares, Series 1 will be entitled to receive a cumulative quarterly fixed dividend yielding 6.5% annually for the initial five year period ending March 31, 2015. The dividend rate will be reset on March 31, 2015 and every five years thereafter at a rate equal to the 5-year Government of Canada bond yield plus 3.75%. The Preferred Shares, Series 1 will be redeemable by Groupe Aeroplan Inc. on March 31, 2015, and every five years thereafter in accordance with their terms.

Holders of Preferred Shares, Series 1 will have the right, at their option, to convert their shares into cumulative floating rate preferred shares, series 2 (the "Preferred Shares, Series 2"), subject to certain conditions, on March 31, 2015 and on March 31 every five years thereafter. Holders of the Preferred Shares, Series 2 will be entitled to receive cumulative quarterly floating dividends at a rate equal to the three-month Government of Canada Treasury Bill yield plus 3.75%.

Groupe Aeroplan Inc. has granted the underwriters an over-allotment option, exercisable in whole or in part anytime up to 30 days following closing, to purchase an additional 900,000 Preferred Shares, Series 1 at the same offering price. Should the over-allotment option be fully exercised, the total gross proceeds of the financing will be C$172.5 million.

The Preferred Shares, Series 1 will be offered by way of a prospectus supplement to the amended and restated base shelf prospectus dated March 26, 2009 filed with the securities regulatory authorities in all provinces and territories of Canada.

The net proceeds of the issue will be used by Groupe Aeroplan Inc. to repay indebtedness, and for general corporate purposes.

The offering is expected to close on or about January 20, 2010, subject to certain conditions, including conditions set forth in the underwriting agreement.

About Groupe Aeroplan Inc.

Groupe Aeroplan Inc. is the global leader in loyalty management. Groupe Aeroplan owns Aeroplan, Canada's premier loyalty program, Carlson Marketing, an international loyalty marketing services, engagement and events provider headquartered in the US, as well as Nectar, the United Kingdom's leading coalition loyalty program. In the Gulf Region, Groupe Aeroplan owns 60 per cent of Rewards Management Middle East, the operator of Air Miles programs in the United Arab Emirates, Qatar and Bahrain. Groupe Aeroplan also operates LMG Insight & Communication, a customer-driven insight and data analytics business offering international services to retailers and their suppliers.

For more information about Groupe Aeroplan, please visit www.groupeaeroplan.com.

Caution Concerning Forward-Looking Statements

Certain statements in this news release may contain forward-looking statements. Forward-looking statements, by their nature, are based on assumptions and are subject to important risks and uncertainties. Any forecasts or forward-looking predictions or statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business and its corporate structure. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons, including without limitation, risks related to the business and the industry, Air Canada liquidity issues, dependency on top four Accumulation Partners that purchase loyalty marketing services including Aeroplan Miles, Air Canada or travel industry disruptions, Airline industry changes and increased airline costs, reduction in activity, usage and accumulation of Aeroplan Miles, retail market/economic downturn, greater than expected redemptions for rewards, industry competition, supply and capacity costs, unfunded Future Redemption Costs, failure to safeguard databases and consumer privacy, consumer privacy legislation, changes to the Aeroplan and Nectar Programs, seasonal nature of the business, other factors and prior performance, regulatory matters, VAT appeal, reliance on key personnel, labour relations and pension liability, technological disruptions and inability to use third party software, failure to protect intellectual property rights, currency fluctuations, interest rate and currency fluctuations, leverage and restrictive covenants in current and future indebtedness, dilution of Groupe Aeroplan shareholders, uncertainty of dividend payments, level of indebtedness - refinancing risk, managing growth, integration of Carlson Marketing as well as the other factors identified throughout the Management's Discussion & Analysis of Groupe Aeroplan available on SEDAR. The forward-looking statements contained herein represent Groupe Aeroplan's expectations as of January 12, 2010, and are subject to change after that date. However, Groupe Aeroplan disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.

The Series 1 Preferred Shares have not been, nor will be, registered under the United States Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States or to U.S. persons absent registration or applicable exemption from the registration requirement of such Act and applicable state securities laws. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification under the securities laws of any such jurisdiction.

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