Alaska Airlines enters into agreement to buy Hawaiian Airlines


Alaska Airlines has entered into an agreement to buy Hawaiian Airlines, the company announced on Sunday.

Alaska Air Group, Inc. will pay $18 per share – a transaction value of approximately $1.9 billion – for Hawaiian Holdings, Inc., the parent company of Hawaiian Airlines.

The boards of both companies have agreed on the deal, which is expected to close in 12-18 months, according to a statement from the airlines. The deal still requires approval from US regulators as well as Hawaiian Holdings, Inc. shareholders.

Authority approval is not a guarantee. The Ministry of Justice is currently trying to block JetBlue’s proposed acquisition of Spirit Airlines. Earlier this year, a federal judge ruled JetBlue and American Airlines needed to end their partnership, saying the alliance weakened competition and harmed consumers. Competition between airlines is the biggest reason for cheap flights, according to Scott Keyes, the founder of Going, a subscription service focused on finding plane tickets.

“A merger between these two airlines — whose schedules have dozens of overlapping flights — would not result in more low-cost flights for consumers, but fewer,” Keyes said of the Alaska-Hawaiin deal.

Under the terms of the new agreement between Alaska Airlines and Hawaiian Airlines, the combined organization will be based in Seattle under the leadership of Alaska Airlines CEO Ben Minicucci. On an investor call about the merger, Minicucci said that out of about 1,400-plus daily flights, they will overlap in just 12 markets. The CEO said he believes “it lands very well” for regulatory approval.

“This combination is an exciting next step in our collective journey to provide a better travel experience for our guests and expand options for West Coast and Hawaii travelers,” Minicucci said in a statement.

The airlines said the move will preserve both brands and unlock more travel destinations for flyers. The combined company will offer service to 138 destinations, including non-stop service to 29 top international destinations in the Americas, Asia, Australia and the South Pacific, the statement said.

Hawaiin Airlines’ fleet is varied, including Airbus A330 and A321, Boeing 717 and an order for 12 Boeing 787. Alaska is an all 737 fleet.

Hawaiian Airlines CEO Peter Ingram said Alaska Airlines approached Hawaiian about the merger.

“With the additional scale and resources that this transaction with Alaska Airlines brings, we will be able to accelerate investments in our guest experience and technology while maintaining the Hawaiian Airlines brand,” Ingram said in a statement.

Earlier this year the travel website The Points Guy ranked Alaska Airlines as the third best airline in the US after Delta Air Lines and United Airlines. Hawaiian Airlines took sixth place.

Alaska Air Group reached one agreement in 2016 to buy Virgin America. Alaska Airlines later dropped the Virgin America name and logo.


Leave a Reply

Your email address will not be published. Required fields are marked *