Alaska Air buys Hawaiian Airlines for $1.9 billion

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Mandatory source: Photo by Toby Scott/SOPA Images/Shutterstock (13034875b) The Alaska Airlines office building is shown at the company’s headquarters in SeaTac, Washington. Alaska Air Group (ALK) is scheduled to report its quarterly earnings this week. Banners and Banners in the United States – July 16, 2022



CNN

Alaska Airlines (Alec) announced on Sunday that it would buy the competitor Hawaiian Airlines (Ha) for $1.9 billion.

The acquisition was the culmination of “several months” of negotiations, according to Alaska Airlines CEO Ben Minicucci. It will include $900 million of Hawaiian Airlines’ debt.

“This is a great deal that brings together two airlines with amazing loyalties in our region,” Minicucci said at a news conference, adding that the merger will give customers in both states expanded domestic and international options.

The transaction is expected to take between Nine and 18 months will see both companies retain their brands, a unique decision that Minicucci and Hawaiian Airlines CEO and President Peter Ingram says was made out of respect for the companies’ nearly 100-year legacy. Airlines and the communities they serve.

Both states are “uniquely dependent on air travel,” Alaska Airlines said in a news release Sunday. The airline currently serves 19 cities, many of which are not connected by roads.

The merger will also turn Honolulu into the company’s second-largest hub, “enabling greater international connectivity for West Coast travelers throughout the Asia-Pacific region with one-stop service through Hawaii,” according to the press release.

Alaska Airlines’ fleet will expand from about 300 to 365 aircraft, serving a total of 138 destinations, including “nonstop service to 29 major international destinations in the Americas, Asia, Australia and the South Pacific,” the company said in a statement. launch.

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Hawaiian Airlines’ inaugural service to Maui’s Kahului Airport prepares for takeoff in Long Beach on Wednesday, March 10, 2021.

Due to Alaska’s membership in the Oneworld international airline alliance, Hawaiian Airlines loyalty customers will have access to enhanced benefits such as lounge access, an enhanced credit card loyalty program and the ability to earn and redeem more miles.

“At Alaska Airlines, we are joining an airline that has long served Hawaii and has a complementary network and shared service culture,” Ingram said. “With the additional scale and resources this transaction with Alaska Airlines provides, we will be able to accelerate investments in our guest experience and technology, while maintaining the Hawaiian Airlines brand.”

Minicucci, who will become CEO of both companies, has heralded the move as “pro-consumer” and will allow. For the country’s fifth-largest airline to compete more aggressively with United, Delta, Southwest and American Airlines, which currently hold 80% of the domestic market share.

The deal may face scrutiny from antitrust authorities. This comes less than a month after JetBlue Airways CEO Robin Hayes testified in federal court. An antitrust lawsuit brought by the Department of Justice, attorneys general from six states and the District of Columbia over the company’s proposed $3.8 billion acquisition of Spirit Airlines.

When asked about the timing of the takeover, Minicucci told reporters: “We will let the lawyers handle this case.”

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