Virgin America Stockholders Approve Merger Deal With Alaska Air
Stockholders in Virgin America have approved the acquisition of their airline by Alaska Airlines. The chairman of Virgin America announced the voting results at a brief shareholders meeting Tuesday.
This is the next-to-last major hurdle for the airline takeover. The remaining step is U.S. Justice Department approval.
Antitrust regulators are already scrutinizing the proposed combination of the nation's sixth and 11th largest airlines as ranked by passengers flown. The feds could require the combined carriers to shed assets to preserve competition.
Alaska Airlines management insists the result of its acquisition of Virgin America would be "pro-consumer." Filings to the Justice Department point out the two carriers compete head-to-head on only a handful of routes, which happen to include Seattle and Portland to San Francisco."
Alaska Airlines and Virgin America's leaders both say they expect the deal to close by the end of this year.
In April, Seattle-based Alaska Air won a bidding war for its smaller, San Francisco-based rival with an offer of $2.6 billion. That represented a significant premium over Virgin America's stock price at that time.
Alaska Airlines executives have been coy about whether the hip Virgin America brand will survive once the two airlines combine. Alaska Air Group CEO Brad Tilden said last week that he expects a decision on that to be reached early next year.
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