Alaska Air to buy Hawaiian Airlines for $1.9 billion.
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Alaska Air to buy Hawaiian Airlines for $1.9 billion.

On Sunday, Alaska Air (ALK) announced that it would acquire Hawaiian Airlines (HA) for $1.9 billion.

The acquisition came after “several months” of negotiations, according to Alaska Airlines CEO Ben Minicucci. Hawaiian Airlines’ debt will be included in the deal at $900 million.

The merger brings together two airlines with incredible loyalty in our regions, said Minicucci in a news conference, adding that customers in both states will have greater domestic and international options.

In a unique move, Minicucci and Hawaiian Airlines CEO and President Peter Ingram say they made the decision in respect of the nearly 100-year legacy of both airlines and the communities they serve by keeping their brands. The deal is expected to take between nine and 18 months.

According to Alaska Airlines, both states are “uniquely reliant on air travel.” Alaska Airlines serves 19 cities, many of which are not accessible by road.

As part of the deal, Alaska will buy Hawaiian Airlines for $18 a share in cash. However, the Biden administration has been much more aggressive when it comes to antitrust issues, especially airline mergers, arguing that they result in higher fares by reducing passengers’ options. In the Northeast United States, it has already ended an alliance between American Airlines and JetBlue, and it is challenging a merger between JetBlue and Spirit Airlines. On Tuesday, the closing arguments in that merger case are set to begin.

In contrast to other airline combinations in which the two airlines serve many of the same routes, Minicucci said he has not spoken to regulators about his proposed merger. An increase over Friday’s closing price. Shares of Hawaiian Airlines surged more than 180% in midday trading, while Alaska Air fell about 15%.