Alaska and Hawaiian Airlines Granted Approval for $1.9 Billion Merger by U.S. Department of Transportation

The U.S. Department of Transportation has given the green light to the proposed $1.9 billion merger between Alaska and Hawaiian Airlines, marking the final regulatory hurdle for the deal. The approval allows the two airlines to combine and operate international routes under a single certificate, paving the way for their merger.

As part of the merger, Joe Sprague, the current regional president of Hawaii/Pacific for Alaska Airlines, will assume the role of CEO at Hawaiian Airlines. This leadership transition will take place after the merger is finalized. Hawaiian Airlines' President and CEO, Peter Ingram, will step down from his position once the merger with Alaska Airlines is completed.

To guide the smooth closing of the merger, an interim leadership team based in Honolulu will be established. Joe Sprague will lead this team and oversee Hawaiian Airlines' operations, while Alaska Airlines pursues a single-operating certificate. During this period, the two airlines will continue to function as separate entities with their individual operating certificates.

Following the completion of the merger, Hawaiian Airlines and Alaska Airlines will operate as a single entity with two distinctive brands. Joe Sprague expressed his honor in working alongside Hawaiian's strong leaders during this transitional phase, emphasizing their commitment to safety and service.

The approval from the U.S. Department of Transportation comes with several safeguards for travelers. The airlines have agreed to protect the value of rewards, maintain existing service on key routes, support rural communities, guarantee fee-free family seating, and lower costs for military families. These public-interest protections were deemed necessary for the Department's consideration and approval of the merger.

Transportation Secretary Pete Buttigieg highlighted the Department's priority of safeguarding the interests of the traveling public. He stated that these protections, ensuring critical services, lower costs, and maintaining the value of rewards miles, mark a new chapter in the Department's efforts to promote a fairer aviation sector in America.

Key provisions of the approved merger include the preservation of rewards miles, the maintenance of equivalent status levels and conferred benefits for loyalty program members, and the commitment to maintain robust service for inter-island and Hawaii-mainland routes. The airlines will also provide certain benefits for service members and their families, including waived change fees and baggage allowances.

With the clearance from the U.S. Department of Transportation, the merger between Alaska and Hawaiian Airlines is expected to be completed soon. The boards of both airlines have already approved the deal, and once finalized, Alaska Air Group Inc., the parent company of Alaska Airlines, will have ownership and control over Hawaiian Airlines.

The merger is anticipated to strengthen Hawaiian Airlines' financial performance, which has been impacted by the ongoing COVID-19 pandemic. While the impact on the employees is still unclear, it is expected that union members will retain their jobs, while changes may occur in the carrier's top leadership team.

Upon completion of the financial terms, the merger will allow the combined airlines to operate under a single FAA operating certificate. The airlines plan to retain both the Alaska and Hawaiian brands, offering customers integrated loyalty benefits and seamless customer service.

Hawaiian Airlines, with a rich history dating back to 1929, is the largest carrier in Hawaii, operating numerous interisland and international flights. Alaska Airlines and its regional partners serve a wide range of destinations across the U.S., Canada, Mexico, and beyond. Together, the combined airlines will serve millions of passengers annually and operate to numerous domestic and international destinations.

The merger represents a significant milestone for both airlines, as they aim to leverage their shared values and legacies in serving and connecting communities.