SEATTLE- The Department of Justice’s (DOJ) antitrust review period for the proposed $1.9 billion merger between Alaska Airlines (AS) and Hawaiian Airlines (HA) expired without opposition. This development marks a significant milestone in the merger process.
Alaska Airlines announced the news, calling it a crucial step towards joining the two carriers. The merger, announced on December 2, 2022, includes $900 million of Hawaiian Airlines’ debt.
Alaska Hawaiian Merger
This merger holds particular significance for Hawaii, where Hawaiian Airlines has operated since 1929. As the state’s largest carrier, Hawaiian Airlines operates approximately 150 daily interisland flights and over 230 systemwide.
It serves 16 U.S. gateway cities and various international destinations including American Samoa, Australia, Cook Islands, Japan, New Zealand, South Korea, and Tahiti.
Alaska Airlines and its regional partners currently serve over 120 destinations across the United States, Belize, Canada, Costa Rica, Mexico, Bahamas, and Guatemala.
The Alaska Airlines-Hawaiian Airlines merger gained momentum as the Department of Justice’s antitrust review period expired without opposition. This development is crucial for Hawaiian Airlines, which reported a second-quarter net loss of $67.6 million.
Despite the Biden administration’s tough stance on airline industry consolidation, exemplified by the DOJ’s lawsuit against the JetBlue-Spirit merger in 2023, this merger cleared a significant hurdle. However, full regulatory clearance still requires the U.S. Department of Transportation’s approval of an interim exemption application.
Hawaii Governor Josh Green expressed support for the merger, citing commitments from Alaska Airlines to maintain the Hawaiian Airlines brand, preserve union jobs, and expand travel options for Hawaii residents. The merger promises to increase nonstop and one-stop destinations for Hawaii residents and enhance HawaiianMiles members’ benefits.
Green emphasized the merger’s potential to strengthen competition in the U.S. airline industry and meet Hawaii’s unique needs. He expressed confidence that the combined entity would offer more travel options and support local businesses.
The merger’s completion could significantly impact the aviation landscape in Hawaii and the broader Pacific region. It may lead to expanded routes, service improvements, and potential changes in airfares and customer options.
Until the regulatory process concludes, Hawaiian and Alaska must continue to operate as competitors.
What happens post-merger?
The Alaska Airlines-Hawaiian Airlines merger enters its final phase following regulatory clearance. Upon financial transfer, Hawaiian shareholders will receive $18 per share, a premium over the closing price of $15.88.
Alaska Airlines CEO Ben Minicucci and Hawaiian Airlines CEO Peter Ingram confirmed plans to maintain and enhance both airlines’ brands. The combined entity will be headquartered in Seattle under Minicucci’s leadership.
The merger aims to preserve most of Hawaiian Airlines’ 7,300 jobs, addressing concerns about workforce impact. This commitment aligns with Hawaii Governor Josh Green’s emphasis on job preservation and expanded travel options for residents.
Frequent flyer programs from both airlines will merge, with existing miles from Alaska Airlines Mileage Plan and Hawaiian Airlines HawaiianMiles honored in the integrated loyalty program.
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