Las Vegas customers will be able to fly to cities they’ve never been able to travel to on Allegiant Air once the surprise $1.5 billion merger deal with Sun Country Airlines announced Sunday is completed later this year.
The two companies gave additional details of the deal to investors Monday morning on how they will blend the two low-fare leisure carriers that have similar cultures.
Executives characterized the deal as a win-win-win for consumers, both airlines’ employees and investors.
“We hold Sun Country in the highest regard, recognizing the close cultural connection between our two companies,” Allegiant CEO Greg Anderson said in a conference call Monday morning.
“Both employ a similar strategy for managing capacity to serve peak leisure travel periods, excel in charter operations, and foster a strong sense of community. Just as Sun Country has been vital to Minnesota over the last 43 years, Allegiant offers similarly important services to the 125 communities we serve.”
The combination of the airlines brings together complementary route networks across Allegiant’s small and mid-sized localities and Sun Country’s larger cities and will provide more than 650 routes, including 551 Allegiant routes and 105 Sun Country routes. Anderson said Sunday only one Allegiant route overlaps with Sun Country.
The two carriers serve around 22 million customers quarterly.
Mexico, Caribbean and beyond
In addition to Mexico, the Caribbean, Central America and Canada, Sun Country’s network includes larger cities Allegiant hasn’t normally entered. The Allegiant business model has always included small-town USA and airports most airlines don’t fly.
Among the Sun Country routes are Denver, Chicago’s O’Hare International Airport, Atlanta, St. Louis, New York’s John F. Kennedy International, Newark, Tampa and Orlando.
Sun Country also flies to Los Cabos, Mazatlan, Puerto Vallarta, Ixtapa, Cozumel and Cancun in Mexico, Grand Cayman, Jamaica, Punta Cana, San Juan, St. Thomas, St. Maarten, Aruba and Turks & Caicos in the Caribbean, Belize, Vancouver, British Columbia, and Anchorage, Alaska.
Officials today said it was too early to determine whether the new Allegiant will add flights to Sun Country’s base of operations, Minneapolis-St. Paul International Airport.
Currently, the Las Vegas-Minneapolis route is dominated by Delta Air Lines with 39 weekly flights, but nonstop flights also are offered by Sun Country (two a day) and Southwest Airlines (three a week).
The companies also haven’t determined whether at Harry Reid International Airport in Las Vegas they’ll fly from Terminal 1, where Allegiant resides, or Terminal 3, where Sun Country is located.
Anderson and Sun Country President and CEO Jude Bricker, a former Allegiant executive who will become an adviser to Anderson and a board member for the expanded 11-person Allegiant board of directors when the deal closes in the second half of 2026, will now work on the transition of the airline to one operating certificate.
“I’ve had the privilege of working at both companies and can say that based on those experiences, this is a tremendous fit across the board,” Bricker said in Monday’s presentation.
“Combining our leading approach to profitably serving the leisure travel market with Allegiant will create a very strong airline that can continue to serve the leisure customer for a long period of time. Many of you know that I’m outspoken in my belief that we should be looking for opportunities that would make Sun Country a stronger competitor and enable us to offer even more choice to our customers. Over the years, we’ve looked at different opportunities, but we believe this combination makes the most sense as it delivers on our value commitments for customers, communities, employees and shareholders alike.”
Stock price
Allegiant Airlines shares fell $5.96, 6.3 percent, to $89.01 on the Nasdaq exchange Monday, but Sun Country Airlines Holdings Inc., was up $1.67, 10.6 percent, to $17.44 a share on Nasdaq.
The companies said Sunday under terms of the deal, Allegiant would acquire Sun Country in a cash and stock transaction at an implied value of $18.89 per Sun Country share. Sun Country shareholders will receive 0.1557 shares of Allegiant common stock and $4.10 in cash for each Sun Country share owned, representing a premium of 19.8 percent over Sun Country’s closing share price of $15.77 on Friday and 18.8 percent based on the 30-day volume-weighted average price. The transaction values Sun Country at approximately $1.5 billion, inclusive of $400 million of Sun Country’s net debt.
Upon closing, Allegiant and Sun Country shareholders will own approximately 67 percent and 33 percent, respectively, of the combined company on a fully diluted basis.
Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on X.
When the merger is done …
-Allegiant third-quarter revenue of $2.5 billion and Sun Country revenue of $1.1 billion totals $3.6 billion.
-Allegiant third-quarter cash flow of $425 million and Sun Country cash flow of $215 million totals $640 million.
-Allegiant 18 million third-quarter customers and 4 million Sun Country customers totals 22 million customers.
-Allegiant 20 billion available seat miles and 7 billion Sun Country available seat miles totals 27 billion available seat miles.
-Allegiant 469 daily flights and 91 Sun Country daily flights totals 570 daily flights.
-Allegiant 121 jets and 70 Sun Country jets totals 191 jets.
-Allegiant 126 destinations and 89 Sun Country destinations (18 international) totals 175 destinations.
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