US ultra-low-cost carrier Allegiant Air plans to acquire Sun Country Airlines for roughly $1 billion through a cash and stock deal, creating a combined company with 195 aircraft serving 175 airports.
The carriers disclosed the plan on 11 January and intend to reveal more details during a call early on 12 January. They intend to close the deal, which has been approved by the boards of both companies, in the second half of 2026, pending shareholder and US antitrust approvals.
“The combination will create a leading leisure-focused US airline, expanding service to more popular vacation destinations across the United States, as well as international destinations, and providing more people with access to affordable, convenient air travel,” the airlines say.
“Allegiant and Sun Country are well positioned to create one of the most-adaptable and resilient airline models in the industry, with the ability to respond quickly to changing market conditions, traveller demand and charter and cargo partner needs.”
Such a deal would shake-up the US low-cost airline sector at a time some players – notably Spirit Airlines – have struggled with insufficient demand for ultra-cheap airline seats.
Las Vegas-based Allegiant, which primarily operates out-and-back flights from secondary cities to leisure destinations, has fared better than some. So too has Minneapolis-based Sun Country, which mostly flies leisure flights from its Minneapolis hub but also has significant charter and cargo operations. Unlike Allegiant, Sun Country flies to many major US cities and to a handful of international destinations in Mexico and the Caribbean.
Allegiant’s fleet includes 130 aircraft, among them 114 Airbus A320-family jets and 16 Boeing 737 Max 8-200s. Sun Country is an all-737NG operator with 67 of those types, according to fleet data provider Cirium. Allegiant also holds unfilled orders for 24 737 Max 7s and 10 737 Max 8-200s.
Allegiant intends to use a mix of cash and stock to purchase Sun Country’s shares at $18.89 each. Allegiant will assume about $400 million of Sun Country’s debt.
“We have long admired Sun Country for their well-run, flexible and diversified business model that optimises for year-round utilisation and strong margins,” says Allegiant chief executive Gregory Anderson.
Sun Country CEO Jude Bricker says his airline has “grown to become one of the nation’s most-respected low-cost leisure airlines, with a unique business model for serving scheduled service and charter passengers, as well as delivering cargo, with a strong brand and deep roots in Minnesota”.
The carriers say that by combining they will generate $140 million in annual savings within three years.
“The combined airline’s flexible capacity will match demand during peak leisure travel seasons and days of the week, while leveraging year-round charter and cargo operations to maximise profitability,” they add.
Sun Country’s cargo operation includes flights for Amazon Prime Air. It flies charters for sports teams, casinos and the US government.
