Alaska Airlines Completes Acquisition of Hawaiian

Alaska Airlines said Wednesday it has completed its acquisition of Hawaiian Airlines for $1.9 billion after reaching an agreement with the U.S. Department of Transportation.

The airlines on Tuesday agreed to maintain major Hawaii routes and introduce consumer protections under a deal that will run for six years.

In August, the Justice Department decided not to block a deal announced in December between Alaska, the fifth-largest domestic U.S. airline, and Hawaiian, the 10th-largest.

Alaska CEO Ben Minicucci said in an interview that the deal would be good for competition and consumers and would allow customers to access both networks, while also giving Alaska access to Hawaiian’s fleet of wide-body planes.

“These are just a few arrows in our quiver in terms of how we deploy aircraft across our network,” Minicucci said. “Placing the right aircraft in the right market to ensure the best outcomes for the combined entity.”

Minicucci said the airline expects to achieve at least $235 million in operational synergies by year three.

The Justice Department has been aggressive under President Joe Biden in blocking airline consolidation. In March, JetBlue Airways and Spirit Airlines canceled a $3.8 billion merger deal after a U.S. judge blocked the deal in January over antitrust concerns following a Justice Department lawsuit.

The agency also successfully challenged a 2020 joint venture agreement between American and JetBlue, called the “Northeast Alliance,” for flights to and from New York and Boston.

The Department of Transportation said Alaska and Hawaiian have agreed to protect the value of frequent flyer awards, maintain existing service on Hawaiian’s core routes to the continental United States and interisland regions, provide competitive access to Honolulu Airport, and award frequent flyer points or miles in the event of disruptions attributable to the airline.

Hawaiian Airlines shares will be delisted and cease trading on the Nasdaq on Wednesday, Alaska said in a statement. The combined organization will continue to trade under the symbol ALK on the New York Stock Exchange.