Ultra-low-cost- carrier Flair Airlines (F8, Kelowna) is reportedly in talks to go public via a merger with the publically-listed New Vista Acquisition Corp., an investment company fronted by former Boeing CEO Dennis Muilenburg. Any deal would shape up as a test of investors' appetites for low-cost carriers and would have to negotiate Canada's airline-related foreign ownership rules.

With a fleet of nineteen B737-8s and three B737-800s, Flair is now flying to 36 destinations in Canada, the US, and Mexico. Earlier this year, the airline reorganised its governance structure to meet Canadian ownership rules. Raising concerns was the day-to-day role of Florida-based 777 Partners, which owns 25% of the airline and acts as its financier and lessor.

Foreign entities can own up to 49% of a Canadian commercial carrier but with no single entity owning more than 25%. In addition, effective control of the airline must rest in Canadian hands. Currently, Canadian investors own 58% of Flair. Despite 777 Partners' minority stake, concerns centred around their influence. A US-registered entity such as New Vista, particularly one run by a high-profile former Boeing boss, may raise the same red flags.

New Vista Acquisition Corp. describes itself as a "blank check company, incorporated as a Cayman Islands-exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses." An early 2021 IPO raised USD276 million. However, those funds remain parked in US Treasury securities, with the company yet to complete any significant business transactions. New Vista says that it may need to raise additional funds to complete any merger.

Following the IPO, New Vista was listed on the Nasdaq and is chaired by former Boeing CEO Muilenburg. The company is 85.1% by individual investors, 13.69% by other institutional investors, and 1.21% by mutual fund investors. Muilenburg is best known for helming Boeing (BOE, Washington National) during the MAX crisis.

Bloomberg reports that while talks continue, no agreement has been reached and says that there is no guarantee an agreement will be reached.

Flair Airlines declined to comment when contacted by ch-aviation.