Alaska Airlines Acquires Hawaiian Airlines
Alaska Air Group and Hawaiian Holdings today announced that they have entered into a definitive agreement under which Alaska Airlines will acquire Hawaiian Airlines for $18.00 per share in cash. The transaction comes to a total of approximately $1.9 billion, inclusive of $0.9 billion of Hawaiian Airlines net debt.
According to company officials, the deal is expected to close in about 12 to 18 months pending approval by Hawaiian shareholders.
The combined company will unlock more destinations for consumers and expand choice of critical air service options and access throughout the Pacific region, Continental United States and globally. Alaska says that the transaction is expected to enable a stronger platform for growth and competition in the U.S., as well as long-term job opportunities for employees, continued investment in local communities and environmental stewardship.
The deal, if approved, will expand Alaska’s share of the domestic market by more than 25% (from 6.4% to 8.2%). However, the airline will still rank fifth domestically, after Delta Air Lines, American Airlines, Southwest Airlines and United Airline.
“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 Hawai‘i travelers,” said Ben Minicucci, Alaska Airlines CEO. “We have a longstanding and deep respect for Hawaiian Airlines, for their role as a top employer in Hawai‘i, and for how their brand and people carry the warm culture of aloha around the globe. Our two airlines are powered by incredible employees, with 90+ year legacies and values grounded in caring for the special places and people that we serve. I am grateful to the more than 23,000 Alaska Airlines employees who are proud to have served Hawai‘i for over 16 years, and we are fully committed to investing in the communities of Hawai‘i and maintaining robust Neighbor Island service that Hawaiian Airlines travelers have come to expect. We look forward to deepening this stewardship as our airlines come together, while providing unmatched value to customers, employees, communities and owners.”
Honolulu is expected to become a key hub for the combined airline with expanded service for residents of Hawai’i to the Continental U.S. and creating new connections to Asia and throughout the Pacific for travelers across the U.S.
The sale is likely to face close scrutiny by federal regulators, who have recently enforced antitrust laws, suing to prevent mergers, acquisitions and other deals that could threaten competition in various industries, including aviation. Last year, the department successfully sued to prevent a partnership between American Airlines and JetBlue. It is also suing to stop JetBlue from buying Spirit Airlines.
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