Allegiant Travel Company (NASDAQ:ALGT) announced on Sunday a definitive agreement to acquire Sun Country Airlines Holdings Inc. (NASDAQ:SNCY), a move that would create a larger, leisure-focused airline with a broader route network and a more stable earnings profile.
The transaction values Sun Country at about $1.5 billion and offers shareholders a mix of cash and stock. Sun Country investors will receive 0.1557 Allegiant shares plus $4.10 in cash per share, implying a value of $18.89 and a roughly 20% premium to the January 9 closing price.
Why It Matters
The combined company would serve roughly 22 million passengers annually across nearly 175 cities, operating more than 650 routes with a fleet of about 195 aircraft. Allegiant’s strength in smaller markets complements Sun Country’s larger-city and international leisure footprint, expanding nonstop options to popular vacation destinations.
Diversified Revenue
Beyond scheduled passenger flights, Sun Country secures long-term cargo and charter contracts, including a multi-year agreement with Amazon Prime Air, a drone delivery service operated by Amazon.com, Inc. (NASDAQ:AMZN), as well as charters for sports teams, casinos, and government clients. Allegiant’s existing charter business further supports steadier cash flow through travel cycles.
Financial Upside
Allegiant expects $140 million in annual synergies by the third year after closing and forecasts the deal will boost earnings per share in the first full year. Management also projects net leverage below 3.0x at close, preserving balance-sheet flexibility.
The deal, approved by both boards, is expected to close in the second half of 2026, pending regulatory and shareholder approvals. Allegiant will remain headquartered in Las Vegas and maintain a significant presence in Minneapolis–St. Paul.
Allegiant’s total available liquidity as of September 30, 2025, was $1.2 billion, comprising $991.2 million in cash and investments and $175.0 million of undrawn revolving credit facilities.
Price Action: Allegiant Travel shares were down 2.10% at $92.98 during premarket trading on Monday, according to Benzinga Pro data. Sun Country Airlines shares were up 12.87%.
