Is the United States Department of Justice (DOJ) going to
block the merger between Hawaiian Airlines and Alaska Airlines? At least one investment publication seems
to think so.
“The Department of Justice is unlikely to
approve its planned $1.8 billion sale to Alaska Air. The antitrust regulator is
preparing to challenge the combination,” wrote
Seeking Alpha, as quoted by Beat of Hawaii.
A decision by the Department of Justice is
due to be made in August.
If true, it would be the second rejection
of an airline merger this year, as the DOJ previously blocked an attempt by JetBlue
Airways to merge with Spirit Airlines in a case that went all the way to a
federal trial. The DOJ said the airline merger was not competitive and
violated antitrust rules.
In this instance, it’s clear to see one of
the reasons why Hawaiian wants to merge – the airline has lost more than $230
million in the last two quarters on top of a $260 million loss last year. But
while several airlines fly to Hawaii, Hawaiian Air has a robust inter island
business.
Still, the losses have been significant. Hawaiian
airlines lost 18 percent of its stock price in the last week.
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