WestJet, which flies to Gatwick, Edinburgh and Dublin, will initially operate the two companies separately and maintain offices in Toronto and Montreal.
WestJet will take a portion of Sunwing’s aircraft, adding 18 Boeing 737s to its own fleet.
WestJet said: “As the two entities transition from competitors to collaborators, the combination of these businesses will be planned in a way that positions Sunwing as an instrumental pillar of the WestJet Group and prioritises the experience of a growing number of guests.”
A similar proposed deal between Air Canada and Air Transat was blocked by the European Commission in 2021 on competition grounds but WestJet/Sunwing was deemed not to have had such a big impact on the market.
WestJet has yet to return to its full pre-Covid transatlantic route network; this summer, it has leased 14 slots a week at Gatwick to Eastern Airways.
