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Canadian Pacific

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Canadian Pacific Sells its Airline

Canadian Pacific jetRussell Baker founded and built Pacific Western Airlines (PWA) into one of the strongest aviation companies in Western Canada, and by the late 1950s and early 1960s, the company was ready to continue expansion. Baker died in 1958, and the PWA president who succeeded him was a man named Donald Watson. Watson was a very savvy entrepreneur, and he moved to replace the bush planes of the company with DC-6Bs that could be used for long distance charter flights to destinations like Asia, the Cayman Islands, and England.

The expansion of PWA included new C-130 Hercules and Lockheed Electras that could be used to continue services to the north for civilian passengers and oil companies. As a result of federal regulations PWA could not fly from Vancouver to Toronto, so it started flights to Buffalo, New York, and Seattle, which brought substantial profits.

In 1974, Premier Lougheed of Alberta bought all the shares of PWA and moved the head office to Calgary. Watson resigned and was replaced by Rhys Eyton. With the change, PWA continued to grow in strength.

PWA was able to purchase the regional airline Transair, and showed record profits generated from its charter passenger service in 1983. With such a strong showing, PWA was privatized in 1983. PWA showed such a strong performance that it was able to buy Canadian Pacific Airlines when deregulation came into effect in 1986.

PWA was able to pay $300 million for Canadian Pacific Airlines and assume its debt of $600 million. The new airline that was formed when PWA bought Canadian Pacific Airlines was Canadian Airlines International.

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