Alaksa Airlines to Buy Hawaiian Airlines for $1.9 Billion
Joe Cortez December 04, 2023
On Sunday, December 3, 2023, Alaska Airlines announced an agreement to purchase rival Hawaiian Airlines for $1.9 billion in cash and assuming nearly $1 billion of debt.
Merger Promises More Flexibility and Destinations for Over 54 Million Flyers Annually
Under the agreement, Alaska will pay $18 per share in cash for their competitor, which they anticipate will grow beyond its value two years after the close. The combined airline will have a collective fleet of 365 narrow- and widebody aircraft, serving 138 destinations between them and through the Oneworld alliance.
Instead of bringing the two airlines together under a single brand, Alaska plans to operate both brands under a single company. Both carriers would work under “a single operating platform, enabling the remarkable service and hospitality of each to be enjoyed by passengers with continued excellence in operational reliability, trust and guest satisfaction for which both companies have been consistently recognized.” Their stated goal is to “enhance competition and expand choice for consumers on the West Coast and throughout the Hawaiian Islands” for a combined total of over 54 million flyers annually.
The merger of the two airlines would also give Alaska Airlines a hub at Honolulu Daniel K. Inouye International Airport (HNL), which the carrier says would help them preserve and grow jobs across Hawaii. The airline says they are committed to “Maintain and grow union-represented jobs in Hawai’I,” including those for pilots and flight attendants.
In a statement about union jobs, the Association of Flight Attendants-CWA said in a statement: “Our first priority is to determine whether this merger will improve conditions for Flight Attendants just like the benefits the companies have described for shareholders and consumers. Our support of the merger will depend on this.”
Alaska also notes working through a Honolulu hub could also provide better domestic and international connectivity. In addition to expanding inter-island travel, flyers would also have a new place to connect for seamless Asia-Pacific travel.
The merger has been approved by both airline boards, and is expected to close no later than 18 months from now. However, the transaction will need to be approved by federal regulators, which have been hawkish about aviation mergers. The Justice and Transportation Departments previously broke up the Northeast Alliance between American Airlines and JetBlue and is currently working to prevent the merger between JetBlue and Spirit Airlines.
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