Alaska Air Group and Hawaiian Holdings today announced a definitive agreement under which Alaska Airlines will acquire Hawaiian Airlines for $18 per share in cash, in a transaction valued at approximately $1.9 billion, including $900 million of Hawaiian Airlines net debt. The merger will expand the network of both airlines, while both maintain their brands independently.
The combination of Alaska Airlines, the fifth-largest airline in the U.S., and Hawaiian Airlines will result in a fleet of 365 narrow and wide-body airplanes, connecting 138 direct destinations and more than 1,200 through the oneworld alliance. Honolulu will become a key hub, both for the residents of the archipelago and for transpacific connections to Asia.
The new company will again have a heterogeneous fleet: when Alaska bought Virgin America in 2016, it inherited a fleet of Airbus A319/A320/A321s that it managed to fully replace by September of this year. Since then, the operator returned to being an «all-Boeing» operator.
With the acquisition, it will incorporate the Airbus A321neo and Airbus A330 from the island airline. At one time, Hawaiian was one of the few operators to place an order for the smaller variant of the A330neo, the -800, but it canceled it in 2018.
The commitment to Hawaii includes maintaining interisland air service and a more competitive platform for growth and job opportunities. The merger also seeks to maintain and increase the union-represented workforce in Hawaii.
The companies expect the transaction to generate benefits for Alaska’s revenues within two years post-close, with estimated synergies of at least $235 million.
Ben Minicucci, CEO of Alaska Airlines, expressed his respect and admiration for Hawaiian Airlines, emphasizing his commitment to investing in the archipelago’s communities. On the other hand, Peter Ingram, President and CEO of Hawaiian Airlines, highlighted the complementary network and shared culture of service of both airlines.
The merger, subject to regulatory approval and approval by Hawaiian Holdings shareholders, is expected to be finalized in 12 to 18 months. The combined organization will be based in Seattle under the leadership of Minicucci, with a team dedicated to integration planning.
