Allegiant and Sun Country Airlines announced plans to merge in a cash-and-stock deal expected to close later this year, creating a larger leisure-focused carrier serving nearly 175 cities.
By yourNEWS Media Newsroom
Las Vegas-based Allegiant and Minneapolis-based Sun Country Airlines announced on Jan. 11 plans to combine operations in a merger aimed at building a more competitive airline focused on leisure travel, according to a joint announcement. The companies said the transaction is expected to close in the second half of the year, subject to regulatory approvals.
The combined airline is projected to carry approximately 22 million passengers annually across nearly 175 cities, operating close to 200 aircraft. The network will concentrate on popular vacation destinations in the United States and abroad, with expanded service to underserved markets.
“This combination is an exciting next chapter in Allegiant and Sun Country’s shared mission in providing affordable, reliable, and convenient service from underserved communities to premier leisure destinations,” Allegiant Chief Executive Officer Gregory C. Anderson said in the announcement. “We have long admired Sun Country for their well-run, flexible, and diversified business model that optimizes for year-round utilization and strong margins.”
Under the terms of the agreement, Allegiant will acquire Sun Country in a cash-and-stock transaction valuing Sun Country shares at $18.89 each. Shareholders will receive $41.50 in cash and 0.1557 shares of Allegiant common stock for every Sun Country share they own. The offer represents a premium of 19.8% over Sun Country’s closing share price of $15.77 on Jan. 9.
Sun Country is currently valued at approximately $1.5 billion, including about $400 million in net debt. After the transaction closes, Allegiant shareholders are expected to own roughly 67% of the combined company, with Sun Country shareholders holding about 33%.
Following completion of the merger, the airline will operate under the Allegiant name and maintain its headquarters in Las Vegas, while continuing a significant operational presence in the Minneapolis–St. Paul area. Until the Federal Aviation Administration issues a single operating certificate, the two carriers will continue to operate independently. The companies said there will be no immediate changes to flight schedules, ticketing, or customer travel experiences.
“Today marks an exciting next step in our history as we join Allegiant to create one of the leading leisure travel companies in the U.S.,” Sun Country Chief Executive Officer Jude Bricker said. “We are two customer-centric organizations, deeply committed to delivering affordable travel experiences without compromising on quality.”
The merged airline plans to offer more than 650 routes, expanding nonstop service to major vacation destinations while increasing connectivity for smaller and underserved U.S. markets. International service will include destinations in Canada, Mexico, Central America, and the Caribbean.
The companies also said the combined operation will introduce an expanded loyalty rewards program, enhancing frequent flyer and membership benefits. Allegiant expects the merger to support workforce growth through new hiring, additional roles, and expanded cross-training opportunities.
Both airlines reported profitability prior to the deal. Allegiant said it expects the combined company to generate approximately $140 million in annual financial benefits within three years of closing, driven by efficiencies such as joint procurement and fleet optimization.
The merged fleet will consist of both Airbus and Boeing aircraft, totaling about 195 planes, with an additional 30 aircraft currently on order. Allegiant was founded in 1997 and is known for offering low average fares to smaller U.S. communities, while Sun Country, established in 1982, operates as a low-cost carrier serving domestic and international destinations.
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