US: Alaska Air wins antitrust approval for Virgin deal with conditions

Alaska Air has won US antitrust approval for its $2.6 billion acquisition of Virgin America on condition that it scale back its code-sharing with American Airlines, the Justice Department said on Tuesday.

The merged company would be the fifth largest US carrier after American Airlines, Delta, United Airlines and Southwest Airlines.

Alaska Air said in a statement that it was pleased with the approval and plans to close the purchase “in the very near future.”

Under the settlement with the Justice Department, Alaska and American would be banned from code-sharing on routes where Virgin and American now compete, the department said.

Code-sharing is also barred on routes that Alaska Air might start in the future if American also flies that route.

The settlement is a good one for Alaska since it does not require the company to dispose of any gates, slots or other hard assets, said airline analyst Robert Mann of R.W. Mann & Company, “It’s not a material impact on the economics of the deal,” said Mann.

Full Content: Reuters

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