In a recent announcement, Southwest Airlines said it would be buying AirTran Holdings, Inc., the parent company of AirTran Airways. Southwest has agreed to buy out AirTran stock with cash and Southwest stock.
The agreement has been accepted by the respective boards of directors, but it must still be approved by stockholders and regulatory agencies before the deal can be closed.
“Today is an exciting day for our Employees, our Customers, the communities we serve, and our Shareholders,” said Gary C. Kelly, Chairman, President, and CEO of Southwest Airlines. “As we approach our 40th Anniversary of providing exceptional Customer Service at everyday low fares, the acquisition of AirTran represents a unique opportunity to grow Southwest Airlines’ presence in key markets we don’t yet serve and takes a significant step toward positioning us for future growth.”
The newly combined airlines will employ approximately 43,000 personnel at more than 100 US and international airports. Additionally, the merger will leave Southwest operating aircraft with an average age of only 10 years, one of the youngest fleets in the industry. That fleet will consist of 685 Boeing aircraft including 737s and 717s. Eventually, the carriers plan to transition to a single operating certificate. The merger also supports Southwest’s plans to investigate the addition of 737-800 aircraft for longer routes.
During the initial phases of the merger, Southwest and AirTran will continue separate operations. Eventually, AirTran will be integrated into the Southwest brand by rolling out the Southwest livery on their aircraft and customer service facilities. Additionally, Southwest and AirTran frequent-flyer programs will eventually be combined.
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