Alaska Airlines' Milestone: Acquisition of Hawaiian Airlines Under Review

The U.S. Transportation Department is reviewing Alaska Airlines' $1.9 billion acquisition of Hawaiian Airlines after it cleared a key review from the Justice Department. The merger would expand destination options for Hawaii residents. The deal faces scrutiny due to concerns over competition and potential fare hikes.

The U.S. Transportation Department announced on Tuesday that it is currently reviewing Alaska Airlines' proposed $1.9 billion acquisition of Hawaiian Airlines, which recently cleared a critical review by the Justice Department. The airlines have filed a transfer application to operate under one certificate under Alaska's acquisition proposal.

The clearance by the Justice Department led to an 11.5% rise in Hawaiian Airlines' shares during premarket trading on Tuesday, while Alaska Airlines saw a 0.5% increase in its share price. 'This is a significant milestone in the process to unite our airlines,' stated Alaska Airlines.

Alaska Airlines, the fifth largest domestic U.S. airline, extended the review period for its proposed acquisition of the 10th largest carrier, Hawaiian Airlines, following the deal's announcement in December. 'Today marks an important milestone, as the regulatory review period by the Justice Department has concluded,' said Hawaii's governor Josh Green.

The merger promises to vastly expand the number of destinations accessible nonstop or one-stop from Hawaii. Just last week, a U.S. judge dismissed a consumer lawsuit aimed at blocking the deal on grounds it could reduce routes and increase fares.

Aviation industry mergers and acquisitions are often scrutinized by U.S. regulators. Earlier this year, a federal judge blocked JetBlue Airways' planned $3.8 billion acquisition of Spirit Airlines. The Justice Department also successfully dissolved JetBlue's Northeast partnership with American Airlines, citing violations of antitrust laws.