Southwest Airlines Acquires AirTran
Dallas based airline company Southwest Airlines has announced plans to acquire AirTran Airways, in the largest take-over to date of a U.S. budget airline.
Southwest Airlines has inked an official commitment to acquire all AirTran Holdings, Inc. outstanding stock for a combination of Southwest Airlines’ stock and cash.
Southwest says that the acquisition of AirTran will enable it to expand its reduced-fare service to a great many more air travelers in numerous domestic markets and will result in hundreds of millions of dollars in yearly savings for customers.
Together, the airlines transported approximately 110 million passengers in 2009.
This purchase is the fourth acquisition of another airline company by Southwest. The carrier most recently purchased the Chicago Midway assets of ATA as well as acquiring Utah-based Morris Air in the 1990s and Texas-based Muse Air in the 1980s.
The boards of directors of both companies have already unanimously approved the agreement. Finalization of the deal, which requires both governmental and shareholder approval, is likely to occur by early 2011, according to officials at AirTran. Southwest Airlines plans to assimilate AirTran into the Southwest brand by moving AirTran aircraft to the Southwest Airlines livery, creating a dependable consumer experience, and merging corporate activities into its headquarters in Dallas, Texas.
Until the transaction closes, AirTran and Southwest Airlines will continue to operate as separate companies. Commercial and operating functions of the two airlines is planned to be completed in 2012, with both fleets operating under the Southwest Airlines FAA operating certificate.
The acquisition will boost Southwest/s workforce to nearly 43,000 employees and expand their fleet to 685 aircraft (not including aircraft orders by both carriers that are currently outstanding
