Alaska Airlines has successfully cleared the U.S. Justice Department’s investigation after announcing their $1.9 billion agreement to acquire Hawaiian Airlines. This marks a significant milestone in the merger process as antitrust regulators did not file a lawsuit to block the deal. The next step for the airlines is to secure approval from the U.S. Transportation Department before finalizing the acquisition, although the timeline for this remains uncertain.
Implications of Merger
This acquisition would be the largest merger between U.S. carriers since Alaska merged with Virgin America eight years ago. The move comes in the wake of the DOJ’s successful thwarting of JetBlue Airways’ acquisition of Spirit Airlines and the dissolution of a partnership between JetBlue and American Airlines in the Northeast. Despite challenges faced by Hawaiian Airlines, such as the Maui wildfires, increased competition from Southwest Airlines, and the slower recovery of travel to and from Asia post-Covid-19 pandemic, the carrier has seen positive booking trends in recent times.
Financial Performance
Hawaiian Airlines has experienced net losses in most quarters since the beginning of 2020, but there has been a positive uptick in their shares, up nearly 12% this quarter as of Monday. This stands in contrast to the performance of other airlines whose shares have declined. Both airlines have expressed their intention to maintain their individual brands while operating under a unified platform, expanding their fleet to over 360 aircraft covering more than 130 destinations.
Overall, the successful clearance of the U.S. Justice Department’s investigation is a crucial step towards the completion of the acquisition between Alaska Airlines and Hawaiian Airlines. It demonstrates the willingness of both carriers to navigate challenges in the aviation industry and work towards a synergistic merger that promises growth and expansion in the highly competitive market.