Alaska Air to Acquire Hawaiian Airlines for $1.9B; Merged Airlines to Expand Benefits for Travelers

Alaska Air Group Inc. announced it will acquire Hawaiian Airlines for $1.9 billion in an all-cash deal. They have entered into a definitive agreement where the former will buy the latter for $18.00 per share in cash.

As per Reuters, the financial agreement also includes $0.9 billion of Hawaiian Airlines net debt. Within the first two years after the merger deal's completion, the firms expect to generate high single-digit profit accretion for Alaska Airlines.

Organizational Arrangement After the Acquisition

Once Alaska Air and Hawaiian Airlines successfully merged, their combined organization is set to be headquartered in Seattle. It was agreed that Alaska Airlines chief Ben Minicucci would then lead the combined company.

CNBC reported that prior to the acquisition, Hawaiian Airlines struggled with a series of challenges, such as the wildfires in Maui. Its earnings also slowed down in recent years due to the increased competition from Southwest Airlines. Now, it is hoping to recover through the merger with Alaska Air.

Promise for New Benefits After Hawaiian Airlines and Alaska Airlines Merged

The companies said that their merger deal will expand the benefits that passengers may enjoy for their trips. Alaska and Hawaiian Airlines said they will unlock more destinations for travelers plus expand the choices of major air service options. The merged firms will also make access throughout the Pacific region, the Continental United States, and the whole world possible.

"Since 1929, Hawaiian Airlines has been an integral part of life in Hawai'i, and together with Alaska Airlines we will be able to deliver more for our guests, employees and the communities that we serve," Hawaiian Airlines' president and chief executive officer, Peter Ingram, said in a press release. "In Alaska Airlines, we are joining an airline that has long served Hawai'i, and has a complementary network and a shared culture of service. With the additional scale and resources that this transaction with Alaska Airlines brings, we will be able to accelerate investments in our guest experience and technology, while maintaining the Hawaiian Airlines brand."

Ben Minicucci, the chief of Alaska Airlines, further said, "This combination is an exciting next step in our collective journey to provide a better travel experience for our guests and expand options for West Coast and Hawai'i travelers. We have a longstanding and deep respect for Hawaiian Airlines, for their role as a top employer in Hawai'i, and for how their brand and people carry the warm culture of aloha around the globe.

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