The airline named after the 49th U.S. state will be allowed to proceed with its proposed acquisition of the airline named after the 50th U.S. state after the Department of Justice allowed a legal review period in which it could have challenged the merger to expire.
Alaska Airlines will now push ahead with a $1.9 billion merger with Hawaiian Airlines after the time period in which the DOJ could complete a regulatory investigation was allowed to expire.
As had been expected when Alaska and Hawaiian Airlines announced their merger deal in December 2023, it didn’t take long before the DOJ launched an antitrust investigation under the Hart–Scott–Rodino or HSR Act.
The legal review period had originally been due to expire last Thursday, but with both sides negotiating the conditions and concessions that would allow the merger to go ahead unchallenged, the DOJ and Alaska agreed to extend the review period by 24 hours.
A further extension was agreed when talks continued longer than expected and the deadline was set to 12:01 am ET on August 20. As the timer ran down, the review period ended without the DOJ launching a legal challenge against the merger deal.
“This is a significant milestone in the process to join our airlines,” a spokesperson for Alaska Airlines said shortly after the review period ended. “During the DOJ’s review, Alaska worked closely with the Hawai‘i Attorney General to reinforce and expand upon our commitments for the future of Hawaiian Airlines and to Hawai‘i consumers.”
Alaska plans to create a single umbrella company with two separate airline brands which will operate 365 aircraft, serve 138 destinations and employ 31,200 workers. In order to clear the DOJ review, the airline said it made commitments to maintaining Hawaiian’s brand, keeping local jobs, and maintaining interisland connections.
“Alaska has reinforced commitments to our state and will maintain the Hawaiian Airlines brand, preserve and grow union jobs in our Hawai‘i, as well as continue to provide crucial passenger and air cargo service to, from, and within the islands,” commented Hawaii Governor Josh Green, M.D.
“I am confident that by the joining of these two airlines, a stronger company will emerge and offer more travel options for Hawai‘i residents and local businesses — and will enhance competition across the U.S. airline industry,” Governor Green continued.
Clearing this hurdle is a significant achievement for Alaska and Hawaiian Airlines, given the DOJ’s reluctance to allow airline tie-ups during President Biden’s time in office.
The DOJ was responsible for blocking a proposed merger between JetBlue and Spirit Airlines after convincing a judge that the deal would have caused consumer harm. The Justice Department’s intervention has left Spirit teetering on the edge, and JetBlue is seriously rethinking its strategy to improve financial performance.
Last week, Alaska Airlines succeeded in having a consumer lawsuit aimed at blocking the merger thrown out of court after a US district judge agreed that the plaintiffs couldn’t prove that they would be personally affected by the takeover.
The plaintiffs launched the lawsuit fearing that Alaska Airlines would treat Hawaiian Airlines in the same way it treated Virgin America, which was acquired in 2017. At the time, Alaska Airlines promised to retain the Virgin America brand, only to shutter the business a year later.
Alaska Airlines convinced the court that the latest merger wouldn’t directly impact the plaintiffs, resulting in the legal challenge being dismissed.
