Hawaiian Holdings (NASDAQ:HA) stock is rocketing higher on Monday after the company announced plans to combine with Alaska Air (NYSE:ALK) in a $1.9 billion deal.
This deal has Alaska Air agreeing to acquire Hawaiian Holdings for $18 per share. That’s a roughly 270.4% premium over the closing price of HA stock on Friday. Investors will also note that the $1.9 billion deal includes $900 million of Hawaiian Airlines debt.
Alaska Air and Hawaiian Holdings are expecting several benefits from the deal. That includes a conservative run-rate synergies estimate of $235 million. Alaska Air also expects the combination to provide it with high single-digit earnings accretion within the first two years of the deal closing.
Peter Ingram, president and CEO of Hawaiian Airlines, said this about the deal in a news release.
“With the additional scale and resources that this transaction with Alaska Airlines brings, we will be able to accelerate investments in our guest experience and technology, while maintaining the Hawaiian Airlines brand.”
Timing of the HA Stock Deal
Hawaiian Holdings and Alaska Air are expecting the deal to close in the first quarter of 2024. It already has approval from both companies’ Boards of Directors. Now it just needs approval from regulators and shareholders of of HA stock.
HA stock is up 182% as of Monday morning as some 2.9 million shares change hands. For comparison, the company’s daily average trading volume is about 2.8 million shares.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
