Alaska Airlines-Hawaiian Airlines $1.9B Merger Gets DOJ Green Light, Awaits Transportation Department Nod

The proposed $1.9 billion merger between Alaska Airlines ALK and Hawaiian Airlines by Hawaiian Holdings, Inc. HA has received clearance from the U.S. Justice Department, marking a significant step forward in the deal announced eight months ago. The merger is now pending approval from the U.S. Transportation Department.

What Happened: The Justice Department’s period for antitrust investigation concluded without any lawsuit to halt the merger, CNBC reported on Tuesday. This comes on the heels of the DOJ’s January victory in court, blocking JetBlue Airways’ acquisition of Spirit Airlines. The DOJ also won a lawsuit last year that dissolved a partnership between JetBlue and American Airlines in the Northeast.

If the Transportation Department gives its nod, this merger will be the biggest among U.S. carriers since Alaska Airlines’ merger with Virgin America eight years prior. The merged entity would operate as a single platform, boasting a fleet of over 360 airplanes and covering more than 130 destinations.

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Despite facing numerous challenges such as the Maui wildfires, increased competition from Southwest Airlines, and a slower recovery of travel to and from Asia post-Covid-19, Hawaiian Airlines has seen its shares surge by nearly 12% this quarter.

Why It Matters: The merger, first announced in December 2023, is expected to offer customers a wider range of domestic and international options, while both airlines will retain their individual brands, a decision influenced by their nearly century-long history and the communities they serve.

The development comes amid Alaska Airlines’ financial health which has been under scrutiny. In August, Alaska Air’s stock hit a technical milestone known as a Death Cross, indicating a potential continuation of the stock’s downward trajectory. The stock was already down 7.93% year-to-date and 20.83% over the past year.

Price Action: On Monday, Hawaiian Holdings, Inc. stock fell and closed 4.39% lower at $15.88 while Alaska Airlines saw a slight increase of 0.52% at its close of $34.96, according to Benzinga Pro.

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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari