Alaska Airlines Closes Acquisition Of Virgin, Promises Instant Benefits For Travelers

Alaska Airlines Closes Acquisition Of Virgin, Promises Instant Benefits For Travelers”

Alaska Air Group Inc ALK.N said on Wednesday it completed its $2.6 billion acquisition of Virgin America Inc VA.O , more than eight months after it was first announced, to become the fifth-largest USA carrier. Alaska has some of the highest marks for punctuality in the U.S., something that may be tricky to manage in an expanded network, particularly given that 80% of the USA market is controlled by only four airlines: American, Southwest, United Airlines and Delta.

In a statement on the Virgin America website, the acquired airline told its customers it will be business as usual for quite a while longer because of the time it will take to merge complex systems and workforces. Then, beginning January 9, 2017, Virgin America Elevate members will be invited by Alaska Airlines to activate new Mileage Plan accounts.

Ted S. Warren  AP
Ted S. Warren AP

Alaska said the deal will add Virgin's 200 daily departures to its existing 1,000 daily flights. Passengers on both airlines will also be able to begin earning rewards on each other's flights.

Seattle-based Alaska Airlines announced its $2.6 billion deal in April, reigniting the debate over airline consolidation.

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To celebrate the merger of two beloved West Coast airlines, Alaska leaders will join employees from Virgin America, Alaska Airlines and Horizon Air later this morning at San Francisco International Airport for the unveiling of a co-branded Boeing 737 featuring a special, one-time livery painted in shimmering red, purple and blue. Alaska Air also settled a lawsuit by passengers and travel agents who opposed the merger. Ben Minicucci will serve as chief executive officer of Virgin America in addition to his role as chief operating officer and president of Alaska Airlines.

On Wednesday, Alaska Air Group CEO Brad Tilden said that his company planned to make this "the most customer-friendly merger ever". Schedule and availability are to be announced on December 21.

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The new Alaska is now the nation's fifth-largest airline, but though the two carriers will combine some customer-facing functions quickly, they will operate separately for the foreseeable future. "This is a big decision and one that deserves months of thoughtful and thorough analysis. We plan to make a decision about the Virgin America brand early next year", Tilden said.

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