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Alaska Airlines Acquisition of Hawaiian Airlines Reshapes the Air Travel Landscape

Alaska Airlines' Acquisition of Hawaiian Airlines Reshapes the Air Travel Landscape

Alaska Air Group, Inc. (NYSE: ALK) and Hawaiian Holdings, Inc. (NASDAQ: HA) jointly announced today the execution of a definitive agreement, signifying Alaska Airlines’ acquisition of Hawaiian Airlines at a cash price of $18.00 per share. The total transaction value stands at approximately $1.9 billion, encompassing Hawaiian Airlines’ net debt of $0.9 billion.

The combination of complementary domestic, international, and cargo networks

This strategic union is poised to open up an array of additional destinations, providing consumers with increased choices in crucial air service options across the Pacific region, Continental United States, and globally.

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The transaction is anticipated to establish a robust platform for growth and competition in the U.S., offering enduring employment opportunities, ongoing community investments, and a commitment to environmental stewardship.

Key Points:

  1. Acquisition Overview:
    • Alaska Air Group to acquire Hawaiian Holdings for $18.00 per share in an all-cash transaction, totaling approximately $1.9 billion.
    • Combined company aims to maintain the strong, high-quality brands of Alaska Airlines and Hawaiian Airlines.
  2. Fleet Expansion and Network Reach:
    • Creates the fifth-largest U.S. airline with a fleet of 365 narrow and wide-body airplanes.
    • Enables access to 138 destinations through combined networks and over 1,200 destinations via the oneworld Alliance.
  3. Hub Development and Connectivity:
    • Honolulu to become a key hub for the combined airline, offering expanded services to the Continental U.S., Asia, and the Pacific.
    • Tripling the number of destinations from Hawai‘i to North America, while maintaining robust Neighbor Island service.
  4. Commitment to Hawai‘i:
    • Strong commitment to Hawai‘i, ensuring robust Neighbor Island air service.
    • Aiming for a more competitive platform supporting growth, job opportunities, community investment, and environmental stewardship.
  5. Employee and Union Commitment:
    • Commitment to maintaining and growing the union-represented workforce in Hawai‘i.
    • Immediate value creation with at least $235 million of expected run-rate synergies.
  6. Investor Call and Timeline:
    • Investor conference call scheduled for today at 5:00 p.m. ET / 2:00 p.m. PT / 12:00 p.m. HT.
    • Anticipated closing of the transaction within 12-18 months.
  7. Strategic and Financial Rationale:
    • Complementary networks to enhance competition and provide greater choice for consumers.
    • Preservation of both Alaska and Hawaiian Airlines’ brands on a single operating platform.
    • Expected to deliver high single-digit earnings accretion for Alaska Airlines within the first two years.
  8. Community and Sustainability Commitment:
    • Focus on growth in union-represented jobs and strong operational presence in Hawai‘i.
    • Commitment to environmental stewardship, aligning with Alaska Airlines’ five-part path to net zero by 2040.
  9. Synergies and Accretion:
    • Expected run-rate synergies of at least $235 million.
    • Transaction multiple of 0.7 times revenue, approximately one third the average of recent airline transactions.
  10. Conditions to Close:
  • Approval by regulatory authorities and Hawaiian Holdings, Inc. shareholders.
  • Expected to close in 12-18 months, with the combined organization based in Seattle under the leadership of Alaska Airlines CEO Ben Minicucci.

He is an aviation journalist and the founder of Jetline Marvel. Dawal gained a comprehensive understanding of the commercial aviation industry.  He has worked in a range of roles for more than 9 years in the aviation and aerospace industry. He has written more than 1700 articles in the aerospace industry. When he was 19 years old, he received a national award for his general innovations and holds the patent. He completed two postgraduate degrees simultaneously, one in Aerospace and the other in Management. Additionally, he authored nearly six textbooks on aviation and aerospace tailored for students in various educational institutions. jetlinem4(at)gmail.com

Airlines

Qantas Expands IndiGo Codeshares from Singapore

Qantas Expands IndiGo Codeshares from Singapore

Qantas has broadened its codeshare partnership with IndiGo, India’s largest domestic airline, enhancing travel options between Australia and India. This expansion allows customers to seamlessly connect from Qantas flights in Singapore to IndiGo’s services to both Delhi and Mumbai.

Previously, the codeshare arrangement enabled passengers on Qantas flights arriving in Bengaluru and Delhi to connect onto IndiGo domestic services to 21 destinations across India. Now, travelers can enjoy a more streamlined journey by transferring through Singapore.

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Additionally, the new arrangement allows customers to incorporate overnight stopovers in Singapore into their travel plans before continuing to Delhi or Mumbai. This provides greater flexibility and convenience for those wishing to explore the city or rest before their onward journey.

Qantas passengers traveling on IndiGo flights benefit from the same checked baggage allowance as their flight from Australia and receive complimentary food and beverages. Furthermore, Qantas Frequent Flyers can earn and redeem points on connecting IndiGo flights (with a QF code) between Singapore and India.

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This partnership expansion comes alongside Qantas’s recent announcement of increased flights to both India and Singapore. Specifically, flights between Sydney and Bengaluru will become daily during the peak holiday season, complemented by additional flights from Sydney and Brisbane to Singapore.

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Virgin Atlantic Sued Over Alleged Age Discrimination: Cabin Crew Seek Justice

Virgin Atlantic Sued Over Alleged Age Discrimination: Cabin Crew Seek Justice

Virgin Atlantic finds itself embroiled in legal proceedings as over 200 former cabin crew members launch a lawsuit against the airline, alleging discriminatory practices during the period of the pandemic.

The dispute centers on accusations that the company unfairly targeted older employees for dismissal while retaining newer, less costly hires.

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The pandemic’s onset in March 2020 triggered a cascade of challenges for the aviation industry, leading Virgin Atlantic to ground a significant portion of its fleet. In response, the airline swiftly implemented cost-cutting measures, including the reduction of its workforce by over 40%, amounting to the loss of 3,000 jobs.

Additionally, it established a “holding pool” for potentially rehiring redundant staff once normal operations resumed. However, the crux of the legal battle lies in the claim that Virgin Atlantic retained approximately 350 new cabin crew members, some with minimal training periods as short as a week.

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While simultaneously letting go of experienced onboard managers, many of whom boasted an average age of 45 years and two decades of service. This perceived discrepancy forms the backbone of the lawsuit, with former employees contending that age became a determining factor in the airline’s decision-making process.

In response, a Virgin Atlantic representative stated: “Virgin Atlantic had to make very difficult decisions following the severe impact of the Covid-19 pandemic on the aviation industry.” Regretfully, this meant a 45% reduction in the total number of employees within the company.

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End of an Era: Qantas Retires Final Boeing 767 Freighter

End of an Era: Qantas Retires Final Boeing 767 Freighter

Qantas has officially bid farewell to its last Boeing 767 aircraft, marking the end of an era that began nearly four decades ago.

The final 767, a dedicated freighter variant registered as VH-EFR, operated its last flight on May 17, 2024. This concluding journey took it from Hong Kong (HKG) to Sydney (SYD) under the flight number QF7526, closing the chapter on Qantas’s use of the 767 after 39 years.

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The Australian airline commemorated the occasion with an Instagram post on Friday, announcing the retirement of VH-EFR, their last remaining 767. According to Cirium Ascend Fleet Analyzer data, this aircraft is a little over 18 years old. It joined the Qantas fleet in 2011, having previously served Japan’s All Nippon Airways (ANA) as a cargo plane.

Despite being owned by Qantas, the aircraft was operated by Express Freighters Australia under the Qantas Freight brand.

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The Boeing 767 has had a versatile history with Qantas. Initially, the aircraft was used on international routes, flying to destinations in New Zealand, Asia, and North America. Following the 1992 merger with Australian Airlines, the 767s were increasingly deployed for domestic services as well.

Although Qantas is retiring this specific freighter, the Boeing 767-300 freighter model remains active globally. Records indicate that 280 of these aircraft are still operational, serving 14 airlines around the world.

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