Today’s podcast looks at the Alaska Air-Hawaiian Air combo, American Air’s tussle with travel agents, and an investment in Travelport.
Good morning from Skift. It’s Tuesday, December 5. Here’s what you need to know about the business of travel today.
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Alaska Air Group said it would buy Hawaiian Airlines in an all-cash transaction valued at $1.9 billion, including Hawaiian’s debt. The parent company of Alaska Airlines and regional Horizon Air said it would continue to operate Hawaiian as an independent brand, reports Edward Russell, editor of Skift publication Airline Weekly.
The proposed merger isn’t a sure thing, given that it faces antitrust review by the Biden Administration. Analysts noted that JetBlue recently attempted to merge with Spirit Airlines, but that deal has since been mired in legal review.
Given that the route networks of Alaska and Hawaiian wouldn’t lead to the same concentration as the networks of JetBlue and Spirit, the probability is higher that the Alaska-Hawaiian deal will go through, reports Russell.
Next, the American Society of Travel Advisors (ASTA) and American Airlines are going head-to-head in a complaint before the U.S. Department of Transport (DOT).
The debate hinges on whether American Airlines has been wrong to withhold about 40% of fare inventory from travel agencies that fail to adopt its preferred booking technology, reports Selene Brophy, Skift’s experiences reporter.
Last month, American Airlines defended itself to regulators about its assertive push of the so-called new distribution capability while accusing travel agents of standing in the way of innovation.
Skift asked ASTA for the group’s response, which it published on Monday exclusively. ASTA said, “What’s lacking from American Airlines’s response is how atrocious their workflow is for new reservations.”
“We fully support the adoption of modern retailing methods when the necessary technologies are ready and in place, and we’re thankful for other airline partners who recognize that and have taken a more responsible approach.”
The complaint is under review by U.S. regulators, with a response expected next year.
Finally, Travelport said Monday that it had raised $570 million in new equity from investors, writes Skift tech reporter Justin Dawes.
The world’s third-largest travel technology company will add new major backers, including Davidson Kempner Capital Management and Canyon Partners, to its existing equity stakeholders, Siris Capital and Elliott Investment Management.
With this new investment, Travelport will have a stronger balance sheet with the least debt amongst its peers, it said. Travelport competes with larger peers Amadeus and Sabre in helping travel agencies book flights from airlines. Once again, as with the other two stories of the day, the travel industry waits for regulators to decide what to do.