Roberto Machado Noa/LightRocket via Getty Images
An Air Canada plane at Toronto's Pearson International Airport.
Air Canada has announced its intention to buy rival airline Air Transat, in a deal worth around $520 million.
Air Canada announced the purchase on Thursday.
A press release said that it will buy all all issued and outstanding shares of the company that owns Transat, for $13 per share.
The deal still requires approval from Transat shareholders.
Jean-Marc Eustach, CEO of Transat said in a statement that Transat is "pleased to join forces with such a successful player in our industry."
Air Canada said it will keep the Air Transat and Transat brands, and Eustach said that "Air Canada will give Transat new perspectives of growth, with the support of a strong network offering many options for connecting traffic."
Passengers can keep booking flights and all bookings with the airline will be honored, he said.
Calin Rovinescu, Air Canada's CEO, said: "Travelers will benefit from the merged companies' enhanced capabilities in the highly competitive, global leisure travel market and from access to new destinations, more connecting traffic and increased frequencies."