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Alaska Airlines To Acquire Hawaiian Airlines – Merger Arbitrage Mondays

  • December 4, 2023

Key Highlights

  • Hawaiian Holdings (HA) to be acquired by Alaska Air Group (ALK) for $1.9 billion or $18 per share in cash.
  • ImmunoGen (IMGN) to be acquired by AbbVie (ABBV) for $7.29 billion or $31.26 per share in cash.
  • The European Commission issued Amazon (AMZN) a Statement of Objections regarding its proposed acquisition of iRobot Corporation (IRBT)
  • Seven active deals were completed last week.

Hawaiian Holdings, Inc. (HA) $4.86

Market Cap: $250.94 million

Enterprise Value: $1.16 billion

Alaska Air Group (ALK) and Hawaiian Holdings (HA) entered into a definitive agreement on Sunday, December 3, 2023, under which Alaska Airlines will acquire Hawaiian Airlines for $18.00 per share in cash, representing a significant premium of over 270% to Hawaiian’s closing price of $4.86 on Friday, December 1, 2023.

Alaska is proceeding with the acquisition, even in the face of the Justice Department having filed a record number of challenges to corporate mergers last year and an ongoing antitrust dispute related to JetBlue’s (JBLU) acquisition of Spirit Airlines (SAVE).

According to Bloomberg, ‘The deal could provide a valuable lifeline to Hawaiian, whose stock has tumbled more than 52% this year. The company has been hurt by the slow return of tourism between Asia and Hawaii following the pandemic and a ramp-up in growth in the Hawaii-to-mainland US market by Southwest Airlines Co. Alaska Air Group will be the parent holding company, with Alaska Airlines and Hawaiian Airlines continuing to operate under their separate brands.’

The completion of the acquisition is conditioned on obtaining necessary regulatory approvals, the consent of Hawaiian shareholders (anticipated to be sought in the first quarter of 2024), and fulfillment of customary closing conditions. The anticipated timeframe for the closure is within 12-18 months. The consolidated entity will have its headquarters in Seattle, led by Ben Minicucci, the CEO of Alaska Airlines.

Alaska’s $4 billion acquisition of Virgin America in 2016 took over eight months to complete and even back there was significant uncertainty whether regulators would allow that merger to proceed. Despite Alaska’s attempt to paint a picture that two brands operating under the same corporate umbrella will not reduce competition, I think the deal will face significant challenges and the 12 to 18 month timeline provided points to the companies being aware of these challenges.

The spread is likely to start out wide and will potentially widen over time, providing for options related opportunities just like the Spirit Airlines deal did in recent weeks. We will take a closer look at the deal in the coming days to see what kind of trades might be possible.

Merger Arbitrage activity increased last week with three new deals announced and seven deals completed.

You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) which automatically updates itself during market hours.

Merger Arbitrage

Deal Statistics:

Total Number of Deals Closed in 2023172
Total Number of Deals Not Completed in 202313
Total Number of Pending Deals
Cash Deals41
Stock Deals20
Stock & Cash Deals3
Special Conditions4
Total Number of Pending Deals68
Aggregate Deal Consideration$1.01 trillion

New Deals:

  1. The acquisition of Rover Group (ROVR) by Blackstone for $2.3 billion or $11 per share in cash.
  2. The acquisition of ImmunoGen (IMGN) by AbbVie (ABBV) for $7.29 billion or $31.26 per share in cash.
  3. The acquisition of Hawaiian Holdings (HA) by Alaska Air Group (ALK) for $1.9 billion or $18 per share in cash.

Deal Updates:

  1. November 28, 2023: Bluegreen Vacations Holding Corporation (BVH) and Hilton Grand Vacations (HGVfiled a Notification and Report Form with the FTC and DOJ on November 14, 2023. The waiting period is scheduled to expire on December 14, 2023.
  2. On November 28, 2023, Luther Burbank Corporation (LBC) and Washington Federal (WAFDmutually agreed to extend the Outside Date of the Merger Agreement from November 30, 2023, to February 29, 2024, in accordance with the terms of the Merger Agreement. The consummation of the Merger remains subject to the receipt of approvals from the Federal Deposit Insurance Corporation and the Board of Governors of the Federal Reserve System.
  3. On November 30, 2023, Kontron America, Incorporated and Bsquare Corporation (BSQR) jointly encouraged shareholders of Bsquare to tender their shares. The Offer expires on December 6, 2023.


  1. On November 28, 2023, Holly Energy Partners (HEP) and HF Sinclair Corporation (DINO) announced that their shareholders approved the previously announced merger of the two companies at their respective shareholders meetings. The transaction is expected to be completed on December 1, 2023.
  2. November 29, 2023: Chico’s FAS (CHS) and Sycamore Partners made the filings required under the HSR Act on October 13, 2023. The waiting period expired on November 13, 2023.
  3. On November 29, 2023, Greenhill & Co (GHL) and Mizuho Financial Group (MFG) announced that they have received all regulatory approvals required to complete their transaction. The closing of the transactions contemplated by the Merger Agreement is expected to occur on November 30, 2023.


  1. On November 27, 2023, the European Commission issued Amazon (AMZN) a Statement of Objections regarding the planned acquisition of iRobot Corporation (IRBT). This formal document represents a key stage in the investigation, wherein the Commission articulates its initial assessment of the potential merger between the two companies in writing.

Shareholders Meeting Schedule:

  1. Chico’s FAS (CHS) – January 3, 2024

Closed Deals:

  1. The acquisition of Avantax Inc. (AVTA) by Cetera Financial Group was completed on November 27, 2023. It took 77 days for this deal to be completed.
  2. The acquisition of Hersha Hospitality Trust (HT) by KSL Capital Partners, LLC was completed on November 28, 2023. It took 92 days for this deal to be completed.
  3. The acquisition of Veritiv Corporation (VRTV) by Clayton, Dubilier & Rice, LLC was completed on November 30, 2023. It took 115 days for this deal to be completed.
  4. The merger of PacWest Bancorp (PACW) and Banc of California (BANC) was completed on November 30, 2023. It took 128 days for this deal to be completed.
  5. The merger of Partners Bancorp (PTRS) and LINKBANCORP (LNKB) was completed on December 1, 2023. It took 282 days for this deal to be completed.
  6. The acquisition of Greenhill & Co (GHL) by Mizuho Financial Group (MFG) was completed on December 1, 2023. It took 193 days for this deal to be completed.
  7. The acquisition of Holly Energy Partners (HEP) by HF Sinclair Corporation (DINO) was completed on December 1, 2023. It took 107 days for this deal to be completed.

Weekly Spread Changes:

The table below shows weekly spread changes between November 24, 2023, and December 1, 2023.

Company Quote
Last Week
Spread Change
IRBT36.8Amazon (AMZN)146.9440.63%25.12%15.51%All Cash
HES141.07Chevron Corporation (CVX)144.815.22%2.14%3.08%All Stock
WRK41.73Smurfit Kappa (SMFTF)38.855.08%2.92%2.16%Cash Plus Stock
CPRI48.42Tapestry, Inc. (TPR)32.717.72%15.74%1.98%All Cash
LBC9.12Washington Federal, Inc. (WAFD)28.294.01%2.11%1.90%All Stock
CNSL4.3Searchlight Capital Partners and British Columbia Investment Management Corporation (N/A)9.30%11.90%-2.60%All Cash
ACI21.98The Kroger Co. (KR)44.623.98%26.92%-2.94%Special Conditions
AMTI0.1999Cyclo Therapeutics, Inc. (CYTH)1.43524.91%36.14%-11.23%All Stock
MIXT6.54PowerFleet, Inc. (PWFL)2.3254.67%74.70%-20.03%All Stock
SAVE14.96JetBlue Airways Corporation (JBLU)4.62107.22%138.28%-31.06%All Cash

Top 10 Merger Arbitrage Deals With The Largest Spreads:

Please do your own due diligence on deals with large spreads. Some of these large spreads might be related to regulatory issues or because of the way the deal is structured. We classify some of these deals as “special situation” deals in our merger arbitrage tool and provide additional details to help with the analysis. There may be unique situations related to special dividends, spinoffs, proration, etc. that need to be accounted for when looking at these spreads.

HA12/03/2023Alaska Air Group, Inc. (ALK)$18.00$4.8606/30/2024270.37%472.18%
SAVE07/28/2022JetBlue Airways Corporation (JBLU)$31.00$14.9606/30/2024107.22%187.25%
MIXT10/10/2023PowerFleet, Inc. (PWFL)$10.12$6.5403/31/202454.67%169.10%
IRBT08/05/2022Amazon (AMZN)$51.75$36.808/05/202440.63%60.52%
GAN11/07/2023Sega Sammy Creation Inc. (N/A)$1.97$1.49512/31/202431.77%29.51%
AMTI09/21/2023Cyclo Therapeutics, Inc. (CYTH)$0.25$0.199912/31/202324.91%336.71%
ACI10/14/2022The Kroger Co. (KR)$27.25$21.9803/31/202423.98%74.16%
PNM10/21/2020Avangrid, Inc. (AGR)$50.30$42.2512/31/202319.05%257.57%
CPRI08/10/2023Tapestry, Inc. (TPR)$57.00$48.4206/30/202417.72%30.95%
GTH10/11/2023New Genetron Holding Limited and Genetron New Co Limited (N/A)$4.03$3.68503/31/20249.36%28.96%

Deals In The Works

Three new potential Merger Arbitrage deals were added to the ‘Deals In The Works‘ section last week.

  1. November 26, 2023: According to 13D filing, Core Industrial Fund, which owns a 63% stake in Fathom Digital Manufacturing (FATH) made a non-binding offer of $4.50 a share to purchase the remainder of the shares it doesn’t already own.
  2. November 28, 2023: According to Reuters, online luxury retailer Farfetch’s (FTCH) founder José Neves is looking to take the company private after a troubled New York Stock Exchange listing.
  3. November 29, 2023: According to WSJ, Health insurers Cigna (CI) and Humana (HUMare in talks for a merger. The companies are discussing a stock-and-cash deal that could be finalized by the end of the year.
  4. December 1, 2023: According to Bloomberg, Equitrans Midstream Corp. (ETRN) is in the early stages of exploring a potential sale.


  1. Theseus Pharmaceuticals (THRX) received an unsolicited proposal from Tang Capital Partners, LP on behalf of Concentra Biosciences LLC for $3.80 per share in cash and a contingent value right (CVR) to acquire its common stock.
  2. According to Reuters, Choice Hotels International (CHH) is preparing to nominate directors to the board of rival Wyndham Hotels & Resorts (WH), seeking to break a stalemate in an $8 billion takeover battle.
  3. On November 30, 2023, Vista Outdoor (VSTO) rejected an unsolicited proposal from Colt CZ.

SPAC Arbitrage

SPAC Business Combination

  1. On November 28, 2023, Plum Acquisition Corp. I (PLMI) and Veea Inc. announced their entry into a definitive business combination agreement.
  2. On November 28, 2023, DUET Acquisition Corp. (DUET) and Fenix 360 Pte Ltd entered into a definitive business combination agreement.


  1. On November 29, 2023, CF Acquisition Corp. VIII (CFFE) and XBP Europe, Inc. (XBPcompleted their previously announced business combination.


  1. On November 27, 2023, Beard Energy Transition Acquisition Corp (BRD), and Suntuity Renewables mutually agreed to terminate their previously announced business combination agreement
  2. On November 30, 2023, ClimateRock (CLRC) and E.E.W. Eco Energy World PLC terminated their business combination.

List of all pending Merger Arbitrage deals:

Disclaimer: I hold long positions in Seagen (SGEN), Capri (CPRI) and Genetron Holdings (GTH). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.