Summary
- Hawaiian Airlines shareholders to vote on merger with Alaska Airlines, could receive as much as $18 per share. Total acquisition valued at $1.9 billion.
- Hawaiian Airlines board recommends voting in favor of the merger, $18 per share is a 270% premium on pre-announcement stock price.
- Unclear if recent aircraft difficulties will affect merger plans; combined fleet expected to expand to 365 aircraft with 138 destinations.
Next month, shareholders of Hawaiian Airlines will meet to vote on the plan announced last month to merge with Alaska Airlines. If approved, Hawaiian Airlines shareholders could receive as much as $18.00 per share, with the entire acquisition valued at $1.9 billion. Originally announced on December 2nd, the deal will mix each fleets into one entity, with each airline maintaining independent brand identities.
In line with a notice of a special meeting of shareholders provided to Easy Flying by Hawaiian Airlines, the airline’s board of directors had unanimously really helpful shareholders to vote in favor of the merger through the planned virtual meeting on February sixteenth. In line with the notice, the proposed compensation of $18.00 per share was a 270% premium on the airline’s stock price before the announcement of the merger.
The special notice for the shareholder meeting included a timeline of meetings between Alaska Airlines Chief Executive Officer Ben Minicucci and Hawaiian’s CEO Peter Ingram, which began on August 2nd and continued through December 2nd. During this era, an executive committee was formed inside Hawaiian Airlines, which identified a big drop in tourism to Hawaii attributable to devastation brought on by wildfires on Maui and technical problems inside the Hawaiian Airlines fleet as external aspects that hurt and would hurt Hawaiian Airlines’ financial performance.
Fleet troubles
Hawaiian, which operates a fleet of fifteen A321neos, said that it anticipated accelerated removals and inspections of a good portion of the Pratt and Whitney PW1100G-JM engines powering its narrowbody fleet. The issues across the A321’s engines aren’t unique to Hawaiian Airlines, as Pratt & Whitney has issued a recall of engines for inspection on 1000’s of the engine type.
It’s unclear how recent difficulties with aircraft types on Alaska’s end will affect the plans to merge. Alaska Airlines operates a fleet of 65 737 MAX 9 aircraft that were grounded following industry wide blowback from Alaska flight AS1282. Following the incident, the FAA has elected to ground and order mandatory inspections of all U.S. 737 MAX 9 aircraft with door plugs.
Photo: Joe Kunzler | Easy Flying
Alaska Airlines had only just reached fleet uniformity across the Boeing 737 type after retiring its last A321neo that it had inherited from Virgin America after the 2 airlines merged years earlier. While each corporations have announced plans to take care of separate brand identities after the merger, it’s unclear if either Hawaiian or Alaska Airlines aircraft is perhaps transferred to and from one another’s fleet.
The combined merger is anticipated to expand what’s currently the fifth-largest U.S. airline to a fleet of 365 narrow and widebody aircraft, leading to 138 destinations in its network and more through the oneworld alliance. In an announcement from Hawaiian Airlines, the carrier said that the brand new combined airline could be more environmentally sustainable attributable to the presence of Alaska’s MAX 9 aircraft.
The merger will likely be one among a number of amongst airlines in the US. JetBlue and Spirit Airlines are currently awaiting the final result of a trial to permit their planned merger. The merger between the 2 was originally blocked by the U.S. Department of Justice. Hawaiian Airlines, which is currently affected by a $900 million debt, is bracing for opposition to the Alaska deal, and previously signaled openness to merging with other carriers if Alaska’s acquisition was not approved.
What do you think that of the Alaska Airlines and Hawaiian Airlines merger? Do you expect Alaska to fly some Airbus aircraft again? Tell us within the comments.