After three weeks of Starwood-Marriott-Anbang, a $2 billion deal almost seems like small potatoes. But it will give Alaska the strength it needs to better challenge west coast rivals like Delta Air Lines.
Alaska Air Group Inc has emerged as the likely winner of an auction for Virgin America Inc, The Wall Street Journal reported on Saturday, citing people familiar with the matter.
The offer was set to beat a rival bid by JetBlue Airways Corp, the people said, according to the Journal.
Alaska Air is expected to pay upwards of $2 billion for Virgin America, which currently has a market value of about $1.5 billion, following a surge sparked by recent news that the company was in play, it reported one of the people as saying.
There is no guarantee Alaska Air will clinch the deal, but if it does, an announcement could come Monday, the Journal quoted its sources as saying.
Virgin America has received takeover bids from JetBlue and Alaska Air as the U.S. budget airline backed by British billionaire Richard Branson explores a sale, a person familiar told Reuters last week.
Asian airlines have also expressed interest in buying Virgin America, although they would have to partner with a U.S. bidder under foreign ownership rules governing U.S. airlines.
Virgin America is 54 percent-owned by Branson’s Virgin Group Ltd and New York-based Cyrus Capital Partners LP, the Journal said.
(Editing by James Dalgleish and Marguerita Choy)
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Photo Credit: Virgin America flights landing in San Francisco, California. John Decker / Reuters
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