Allegiant to Buy Sun Country Airlines

Connects residents of under-served U.S. cities to popular vacation destinations through nonstop flights and bundled third-party travel products
Beyond its core airline operations, the company operates a Sunseeker Resort segment that includes hospitality and golf amenities
Founded in 1997 and headquartered in Las Vegas, NV

Barclays

Provides scheduled passenger service, air cargo, and charter flights across the U.S., Latin America, and internationally
Operates a fleet of 63 Boeing 737-NG aircraft and serves a diverse client base that includes leisure travelers, military branches, sports teams, and commercial cargo partners
Founded in 1983 and headquartered in Minneapolis, MN

Goldman Sachs

$1.5 billion/Cash and stock

The combination aims to build a resilient airline that can quickly adapt to demand while expanding affordable leisure travel from underserved communities to top vacation destinations across North America, Mexico, Central America, and the Caribbean
The merged airline will operate more than 650 routes by combining Allegiant’s small- and mid-market network with Sun Country’s large-city reach, improving reliability and seasonal flexibility while creating a stronger loyalty program with approximately 23 million members
The merger is expected to deliver $140 million in annual synergies by year three and be EPS-accretive within one year, supported by fleet, procurement, cost, and revenue improvements while keeping net adjusted debt/EBITDAR below 3.0x
A diversified model—combining Sun Country’s Amazon Prime Air cargo and charter contracts with Allegiant’s charter business—is expected to provide stable revenues and maximize aircraft utilization
Gregory C. Anderson, Allegiant CEO, said, “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. We have long admired Sun Country for their well-run, flexible, and diversified business model that optimizes for year-round utilization and strong margins.”

Sun Country shareholders will receive 0.1557 shares of Allegiant common stock and $4.10 in cash for each Sun Country share owned
The offer price represents a premium of 19.8% over Sun Country's closing share price of $15.77 on January 9, and an 18.8% premium based on the 30-day volume-weighted average price
The transaction values Sun Country at approximately $1.5 billion, including $0.4 billion of net debt
Upon closing, Allegiant and Sun Country shareholders will own approximately 67% and 33%, respectively, of the combined company on a fully diluted basis