Allegiant-Sun Country's $1.5B Deal Secures Approval From the U.S. DOT
Allegiant Travel Company (ALGT) announced that it has received the U.S. Department of Transportation (“DOT”) approval in relation to its previously announced acquisition deal with Sun Country Airlines (SNCY).
The U.S. Department of Transportation has approved the joint interim exemption application of both airline subsidiaries, which will enable both airlines to continue operating as separate carriers under common ownership post-deal closure (which remains pending based on further action by the DOT). Securing the U.S. Department of Transportation approval marks a major step toward the completion of the deal.
Allegiant chief executive officer, Gregory C. Anderson, stated, "This approval underscores the strength of our shared vision and the thoughtful approach both teams have taken throughout this process. We remain focused on bringing these organizations together in a way that builds on their strengths, while positioning the combined company for long-term growth and resilience."
We would like to remind investors that the deal was initially announced on Jan. 11, 2026, per which Allegiant will purchase Sun Country in a cash and stock transaction at an implied value of $18.89 per Sun Country share. The deal value is estimated to be around $1.5 billion, which includes $0.4 billion of Sun Country's net debt.
DOT’s Approval Clauses
The DOT approval grants both Allegiant and Sun Country to continue to operate independently, while retaining their respective unique business models, route networks, customer experiences and proceeding toward a single operating certificate, post the completion of the proposed deal. Both airlines are optimistic about this aforesaid grant as it shall help both airlines operate efficiently and retain their respective customers, employees and stakeholders.
The grant of an exemption by the DOT satisfies the last remaining regulatory approval-related condition to the closure of the proposed deal. The deal still remains subject to the satisfaction or waiver of the remaining customary closing conditions, which include the approval from the shareholders of both Allegiant and Sun Country. Special shareholders' meetings have been scheduled for May 8, 2026, by both Allegiant and Sun Country for their respective parts.
Subject to the satisfaction or waiver of the remaining deal-closure conditions, Allegiant-Sun Country’s $1.5 billion deal is anticipated to be completed as early as May 13, 2026, following shareholder approval at the special meetings.
Allegiant presently carries a Zacks Rank #3 (Hold), and Sun Country carries a Zacks Rank #5 (Strong Sell).
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