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North West Company spends $31M to buy its own airline

The North West Company Inc. announced Friday it has purchased Thunder Bay, Ont.-based North Star Air for $31 million.

Northern food and supply retailer to use planes to secure supply chain

A North Star Air cargo plane is shown in this file photo. The Thunder Bay-based airline has been bought by the North West Company. (North Star Air)

One of the most prominent Northern supply companies is growing, adding an airline to its roster.

The North West Company Inc., based in Winnipeg, announced Friday it has bought Thunder Bay, Ont.-based North Star Air for $31 million.

It also expects to invest another $14 million to expand airplane and hub capacity immediately after the sale, North West said in a news release.

"Moving goods is critical to our success and NSA is a proven, superior performer," said Edward Kennedy, president and CEO of North West.

Though the company will continue using third-party carriers to ship goods North, having an in-house airline would make service faster and more consistent, Kennedy said.

The deal is expected to close in June 2017, once it passes regulatory hurdles.