Alaska Air’s $1.9B Hawaiian Airlines Deal Faces Regulatory Hurdles

Alaska Air Group has unveiled plans to purchase Hawaiian Holdings, the parent company of Hawaiian Airlines, in a substantial $1.9 billion transaction, inclusive of $0.9 billion in assumed debt. The agreement, solidified between the two entities, outlines Alaska Airlines’ commitment to an all-cash payment of $18.00 per share.
Hawaiian Airlines has faced significant challenges in the past year, including the impact of devastating wildfires on Maui, a subsequent downturn in tourism, heightened fuel costs, and a jet engine recall affecting its Airbus A320neo aircraft. These factors have led to substantial losses for Hawaiian Airlines, resulting in a notable 65 percent decrease in its share price over the last 12 months.
As two major West Coast carriers embark on this strategic alliance, regulatory scrutiny from U.S. antitrust enforcers is anticipated. With a pledge to prevent monopolization and safeguard competition, regulators are likely to closely examine the deal, especially considering that 80 percent of the U.S. aviation sector is already controlled by the “Big Four.”
Recent legal battles, such as the ongoing Department of Justice lawsuit aiming to block JetBlue Airways’ proposed acquisition of Spirit Airlines, underscore the regulatory environment. If approved, this would position JetBlue as the fifth-largest airline in the U.S. behind American, United, Delta, and Southwest.
This move by Alaska Air Group follows the dissolution of the “Northeast Alliance” and prompts concerns about potential market dominance in the Alaska-Hawaiian merger. The combined entity could control over 50 percent of the market for flights to Hawaii, a premier global tourism destination.

Alaska Air CEO Ben Minicucci expresses confidence in regulatory approval by the end of next year, citing a minimal overlap of 12 out of 1,400 flights currently operated by both carriers. However, critics, including industry expert Scott Keyes, warn that such mergers may lead to reduced competition and ultimately fewer cost-effective flight options for consumers.
Despite differing opinions, Alaska emphasizes the complementary nature of their networks, asserting that the merger will enhance competition and offer expanded choices for consumers on the West Coast and throughout the Hawaiian Islands. While the acquisition agreement has received approval from both boards, it remains contingent on Hawaiian Holdings’ shareholders’ approval, U.S. regulatory clearances, and customary closing conditions, with the merger expected to conclude within 12 to 18 months. The combined organization will be headquartered in Seattle under the leadership of Alaska Airlines CEO Ben Minicucci, with a dedicated team focusing on integration planning.