California-based Virgin America said today that its shareholders have approved the air carrier’s merger with Seattle-based Alaska Air Group, clearing one of the major requirements for the $2.6 billion deal to take effect later this year.
Under the terms of April’s merger agreement, Virgin America’s investors will receive $57 a share, which would pay a nearly 50 percent premium on the stock price in effect just before the deal was announced.
Alaska Air Group, which is the corporate parent of Alaska Airlines, won out after a fierce bidding war with JetBlue. The merger will give Alaska a firmer foothold in California, particularly for high-traffic routes to New York and Washington, D.C. Alaska Air’s CEO, Brad Tilden, has said the combined company might still keep Virgin America as a brand that’s distinct from Alaska Airlines.
The Virgin brand would have to be licensed from British billionaire Richard Branson’s Virgin Group, at a cost that’s likely to amount to millions of dollars.