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Update 1.40pm: Update stocks, adds Alaska Airlines CEO comment.
Hawaiian Companies (NASDAQ: HA) dropped rapidly to 5.6 % and is now down 2.8% amid a report on the Justice Department’s review of its planned sale to Alaska Air.
There’s a report on the Justice Department’s review of the deal that the regulator is reviewing the deal as it did with JetBlue (BLUE) purchase of Spirit (SAVE), which has been blocked by antitrust regulators, according to traders, who cited a CTFN report circulated on Thursday. The Justice Department is explaining its concerns to the parties, although it is unclear how the airlines can remedy the problems.
Late last month, Hawaiian Holdings (HA) and Alaska Air (NYSE:ALK) have entered into a timing agreement with the Department of Justice regarding the intended settlement. Both airlines have committed not to complete the merger before 90 days following the date on which both parties have certified substantial compliance with the second request.
The timing agreement comes after the airlines in February received a request for more information about their settlement from the Department of Justice. The Justice Department’s request for more information followed after a judge in January blocked JetBlue’s (JBLU) planned $3.8 billion acquisition of Spirit Airlines (SAVE). The airlines decided to terminate the agreement last month.
“I remain confident that our agreement rests on the merits of being pro-competitive and pro-consumer,” Alaska Air CEO Ben Minicucci said in an interview with CNBC on Thursday. “As far as the approval date, I won’t put a timeline on it. We hope it will be by the end of the year, but we will take the time to provide the Department of Justice with the information it needs to make the right decision.”
In early December, Alaska Air entered into a deal with Hawaiian Airlines (HA) for $18 per share in cash, valuing the transaction at about $1.9 billion including debt.
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