Alaska Airlines says it has finalized its $1.9 billion acquisition of Hawaiian Airlines less than 24 hours after the Department of Transporation (DOT) gave its blessing to the deal on the proviso that the combined airline made a number of consumer-friendly concessions.
Alaska Airlines and Hawaiian Airlines will operate as two separate brands but under a single airline operating license as part of a combined umbrella company with a single frequent flyer program.
First announced in December 2023, the Alaska Airlines Group had to clear a number of regulatory hurdles before it could finalize the deal, including an extensive review by the Department of Justice (DOJ) which could have used antitrust laws to try to block the merger.
The final hurdle that the airline only cleared on Tuesday was a review by the Department of Transportation (DOT), which had to approve an exemption request for the two airlines to operate under a single license.
The DOT decided to clear the path for Alaska Airlines to acquire Hawaiian Airlines after the airline group agreed to a number of concessions, which includes securing frequent flyer miles and status, inter-island connectivity in Hawaii and essential air services in Alaska, as well as a number of other consumer-friendly policies.
The Biden administration also made the Alaska Airlines Group agree to lower travel costs for active military members and their families by waiving checked luggage and hand baggage fees.
“This is a historic day for Alaska Airlines as we officially join with Hawaiian Airlines,” commented Alaska Airlines CEO Ben Minicucci after the deal was finalized on Wednesday.
“Alaska and Hawaiian share tremendous pride in connecting communities with award-winning service, and we look forward to inviting more guests on board to experience what makes both brands unique,” Minicucci continued.
Although Alaska Airlines and Hawaiian Airlines will operate as separate brands, the combined air company with operate 1,500 daily flights to 141 destinations. The air company will also employ a total of 33,000 people and operate 350 aircraft.
The company will maintain its existing hubs in Seattle, Honolulu, Los Angeles, San Francisco, Portland, San Diego and Anchorage, although the DOT has made Alaska Airlines agree to not turn Honolulu into a fortress hub that would disadvantage rival airlines.
The agreement with the DOT means that passengers who are members of either Alaska Airlines or Hawaiian Airlines frequent flyer programs shouldn’t be disadvantaged by the merger, although a single loyalty program isn’t expected to be introduced until mid-2025.
After the acquisition was finalised, Hawaiian Airlines’ stock was delisted on the NASDAQ and both airlines will trade through a single umbrella company which will retain the ALK ticker on the New York Stock Exchange.
