Alaska Air nears deal to buy Virgin America for over $2 billion.

[CPT]

I would have thought JetBlue would be a better fit, this is interesting and $$ talks!

Alaska Air nears deal to buy Virgin America for over $2 billion: source (http://www.reuters.com/article/us-virgin-america-m-a-alaska-air-group-idUSKCN0WZ0Q7)


Alaska Air Group Inc (ALK.N) is nearing a deal to acquire Virgin America Inc (VA.O) for more than $2 billion, having outbid JetBlue Airways Corp (JBLU.O), a person familiar with the matter said on Saturday.

A deal could be announced as early as Monday, the source told Reuters.

Earlier, The Wall Street Journal said Alaska Air had emerged as the likely winner of an auction for Virgin America, citing people familiar with the matter.

Alaska Air is expected to pay upwards of $2 billion for Virgin America, which currently has a market value of about $1.5 billion, following a surge sparked by recent news that the company was in play, it reported one of the people as saying.

There is no guarantee Alaska Air will clinch the deal, the Journal quoted its sources as saying.

Virgin America has received takeover bids from JetBlue and Alaska Air as the U.S. budget airline backed by British billionaire Richard Branson explores a sale, a person familiar told Reuters last week.

Asian airlines have also expressed interest in buying Virgin America, although they would have to partner with a U.S. bidder under foreign ownership rules governing U.S. airlines.

Virgin America is 54 percent-owned by Branson’s Virgin Group Ltd and New York-based Cyrus Capital Partners LP, the Journal said.

[zeus]

I just finished reading this. I thought Virgin America was a pretty popular airline, but apparently they do not generate the revenue per seat to make them profitable. Will be interesting to see if JetBlue sweetens the offer.

[Evoni]

I wish this would fall through. While I would prefer Virgin America not to sell, if they have to I was hoping for Jet Blue. I really dislike Alaska Air.

[CPT]

Sure looks like it's happening now.

Alaska Air to buy Virgin America for $2.6 billion (http://finance.yahoo.com/news/alaska-air-buy-virgin-america-101746557.html)


NEW YORK (Reuters) - Alaska Air Group Inc (ALK.N) said on Monday that it would buy Virgin America Inc (VA.O) for $2.6 billion to become the top carrier on the U.S. West Coast and compete more effectively with larger airlines.

[charlie50]

Other than the name and equipment i'm not seeing a major advantage it the acquisition of virgin . It only goes to 16 locals total in and around the u s . 4 east coast 4 west coast 4 in the central u s and 4 out side the u s

[sondor]

Other than the name and equipment i'm not seeing a major advantage it the acquisition of virgin . It only goes to 16 locals total in and around the u s . 4 east coast 4 west coast 4 in the central u s and 4 out side the u s
I think part of it is getting the gates at certain airports.

[charlie50]

I think part of it is getting the gates at certain airports.

That make more scents than anything else ive heard .

[Big Mac]

I agree I don't see a big benefit for any of the airlines buying Virgin. I am a big fan of Alaska they have been my go to out of the Pacific Northwest.

Wait and see what benefits this brings to Alaska

[sondor]

That make more scents than anything else ive heard .
From a news article........

So what exactly did Alaska Airlines buy?


Although Virgin America operates a fleet of 60 Airbus A320 jets, the airline owns only five of them with rest leased from various companies around the world.


As a result, Virgin America's most valuable assets are its terminal space at San Francisco International Airport and Los Angeles International Airport, along with landing rights at Love Field in Dallas, LaGuardia in New York, and Reagan National in Washington, D.C., Bhaskara said.


And then there's the cachet of the Virgin brand, which brings intangible value to the airline.


At first glance, forking out $4 billion for some terminal space, landing rights, and a few jets makes little sense, but a deeper dive shows that Alaska's move, though risky, may be a smart buy for three key reasons.


First, the acquisition of the San Francisco-based airline keeps Virgin America and its sizable West Coast presence out of JetBlue's control. New York-based JetBlue has a strong East Coast and transcontinental business, but it still lags behind Alaska, Virgin America, and Southwest in its ability to serve the western United States.


Acquiring Virgin would have given JetBlue instant scale on the West Coast and bolster its already formidable transcontinental business.

[charlie50]

Well glad jet blue didn't get it .we've heard bad stuff about it .

[Jen Jen]

I will be flying home from Reno on Alaska Air. They just started non-stop flights from Orange County. I'm kind of nervous flying on a small plane. Good thing the flight is only an 1 hour and 15 minutes long. I do like Jet Blue.

[twinslotaddicts]

I absolutely love JetBlue and they fly from my local airport LGB to Vegas which is AMAZING!!! I was hoping they'd be the ones buying Virgin but oh well.

Ang

[TwoArmedBandito]

I'd fly alaska air over any airline.

Sent from my SM-G900V using Tapatalk

[Big Mac]

I'd fly alaska air over any airline.

Sent from my SM-G900V using Tapatalk

I am right with you...They have been great on all my flights with them over the years.

[sondor]

The only place I ever flew Alaska was a charter to Mexico, it was fine but still seems odd to take an Alaska flight to Mexico.......