Alaska Air Set to Acquire Hawaiian Airlines in a $1.9 Billion Transaction Potentially Under Regulatory Review

Alaska Air Set to Acquire Hawaiian Airlines in a $1.9 Billion Transaction Potentially Under Regulatory Review

04 Dec, 2023

 

Alaska Air Set to Acquire Hawaiian Airlines in a $1.9 Billion Transaction Potentially Under Regulatory Review

 

In a significant move for the U.S. aviation market, Alaska Airlines has agreed to acquire Hawaiian Airlines in a $1.9 billion deal, marking a potential clash with the Biden administration's concerns about rising airfares. The agreement, announced on Sunday, envisions the combined company preserving both airlines' brands, a departure from the usual consolidation trend dominating the U.S. market.

Alaska Airlines is set to pay $18 in cash for each share of Hawaiian, valuing the deal at $1.9 billion, including $900 million in Hawaiian debt. The merger aims to create a more robust competitor against the nation's major airlines: American Airlines, Delta Air Lines, Southwest Airlines, and United Airlines. Alaska CEO Ben Minicucci sees the combined entity as a "clear leader" in the lucrative $8 billion Hawaiian market.

The companies plan to maintain Honolulu as a key hub, emphasizing their commitment to the union-represented workforce in Hawaii. The deal is expected to enhance connectivity, providing passengers with access to 138 destinations across the continental U.S. and the Pacific, including 29 international destinations. The combined airline will join the oneworld Alliance, featuring major carriers like American Airlines and British Airways.

While the boards of both companies have approved the deal, it still requires shareholders' approval from Hawaiian Holdings and regulatory clearance. The Biden administration, wary of increased airfares, has been scrutinizing airline consolidations, exemplified by its efforts to block JetBlue's acquisition of Spirit Airlines.

Travel industry analyst Henry Harteveldt suggests that given the limited overlap in routes between Alaska and Hawaiian, the proposal may not trigger significant concerns in Washington. Additionally, neither airline operates as an ultra-low fare carrier, potentially alleviating fears of reduced downward pressure on fares.

As the airlines navigate the regulatory process, they will engage with their unions to streamline operations. The Air Line Pilots Association is evaluating the proposal, emphasizing the airlines' historic focus on employees as a potential synergy in their corporate cultures.

 


Related News

Trump's reciprocal tariffs raise uncertainties in South Korea-US partnership

03 Apr, 2025

Trump’s new reciprocal tariffs are creating uncertainty in the South…
Read More
US and India Strengthen Strategic Partnership with Shared Commitment

28 Mar, 2025

The United States and India reaffirmed their commitment to strengthening…
Read More
US AI Startup Unveils New Tool for Seamless Creative Collaboration

06 Mar, 2025

Flora, a startup founded by Weber Wong, has launched an…
Read More
US business growth slows as consumer inflation expectations rise sharply

03 Mar, 2025

U.S. business activity nearly stalled in February due to mounting…
Read More
USA India Business Summit & Georgia Tech to Host 2025 Forum

11 Feb, 2025

USA India Business Summit (UIBS) and Georgia Tech CIBER (GT…
Read More
India, US Discuss PM Modi’s Early Visit to Strengthen Ties

04 Feb, 2025

India and the United States are actively working on an…
Read More

© 2025 Business International News. All rights reserved | Powered by Cred Matters.