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Richard Branson gets frosty over Alaska Air

Richard Branson, pretends he’s an airplane on the runway after the arrival of Virgin Atlantic’s 787-9 Dreamliner jet from London. (Virgin Atlantic Photo)

British billionaire Richard Branson kicked off Virgin Atlantic’s nonstop service from London to Seattle today with a rhetorical kiss for the Emerald City, but also a verbal kick at Seattle-based Alaska Airlines, which is absorbing another one of the airlines he founded.

First, the kiss: Branson took a star turn on the tarmac after Flight 105’s arrival at Seattle-Tacoma International Airport, surrounded by flight attendants bearing Union Jack umbrellas. Wearing blue jeans and a hometown Filson lumberjack jacket, he paid tribute to Seattle’s entrepreneurial bent.

“It’s a city after my own heart,” Branson told a crowd of VIPs and journalists assembled in the airport’s arrival hall. “Very entrepreneurial, some of the greatest entrepreneurs in the world live here.”

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Richard Branson mourns Virgin America

Virgin billionaire Richard Branson reflects on the passing of Virgin America. (Virgin Photo)

The Virgin Group’s billionaire founder, Richard Branson, says “many tears” are being shed over Alaska Airlines’ decision to retire the Virgin America brand in the wake of its $4 billion acquisition.

Branson bid farewell to the brand in a “Dear Virgin America” letter posted online today, even though the brand isn’t likely to be phased out until 2019.

He compared the news of the phase-out to his 1992 sale of Virgin Records for $1 billion, “which we needed to fight off British Airways’ Dirty Tricks campaign to try to put Virgin Atlantic out of business.

“With a lot of things in life, there is a point where we have to let go and appreciate the fact that we had this ride at all,” Branson said. Most of the letter was devoted to a walk down memory lane, from the company’s launch day in 2007, through zany promotions such as an in-flight wedding performed by Branson, an in-flight Skype session with Oprah Winfrey and the annual Chihuahua airlift.

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Why Alaska Airlines is killing Virgin America

Alaska Airlines will retire the Virgin America brand and logo by the end of 2019. (Alaska Air Photo)

It all comes down to cost and consistency of branding: That’s why Alaska Airlines announced today that it would retire the Virgin America name for the airline it acquired last year.

Seattle-based Alaska Air Group completed the $4 billion transaction (including debt and lease payments) to take over Virgin America’s operation and its routes late last year – but the question of what to do with the operation’s name had been hanging over the acquisition since it was announced last April.

“We spent the last 10 months conducting extensive research and listening carefully to what fliers on the West Coast want most,” Sangita Woerner, Alaska Airlines’ vice president of marketing, said in today’s announcement. “While the Virgin America name is beloved to many, we concluded that to be successful on the West Coast we had to do so under one name – for consistency and efficiency, and to allow us to continue to deliver low fares.”

Alaska said the Virgin America name and logo would be retired “likely sometime in 2019.” Alaska has to wait at least long enough to win certification from the Federal Aviation Administration for the two airlines to operate as a single carrier.

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Alaska Air completes takeover of Virgin America

An Alaska Airlines jet sports a paint job that pays homage to Virgin America’s red color scheme as it taxis at San Francisco International Airport. (Boeing Airplanes Photo via Twitter)

Alaska Air Group completed its acquisition of Virgin America today, celebrating the rise of the nation’s No. 5 air carrier with a co-branded jet painted in blue, purple and red.

“Alaska Airlines and Virgin America are different airlines, but we believe different works – and we’re confident fliers will agree,” Brad Tilden, CEO of Alaska Air Group, said in a news release.

The acquisition follows through on months of work to seal the $2.6 billion deal ($4 billion, including debt and aircraft operating leases). The U.S. Department of Justice gave its regulatory approval last week after tweaking the terms to comply with antitrust requirements.

The combined airlines vaulted Alaska Air Group from No. 6 to No. 5 on the list of U.S. carriers – past JetBlue, which had courted Virgin America as well. Alaska and Virgin America are projected to generate more than $7 billion in annual revenue and operate about 280 aircraft.

For the time being, the all-Boeing Alaska Airlines fleet and the all-Airbus Virgin America fleet will retain their separate brands. Except for one plane.

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Virgin America shareholders OK Alaska merger

Virgin America and Alaska Air Group are getting set to merge. (Credit: Alaska Air)

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.

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Alaska Air is buying Virgin America for $2.6B

Virgin America and Alaska Air Group confirmed their merger plans. (Credit: Alaska Air)

Alaska Air Group confirmed reaching a $2.6 billion deal to buy Virgin America after a bidding war with JetBlue Airways.

“This was a hard-fought competition, and we were very happy to come away as the successful bidder,” Alaska Air CEO Brad Tilden told reporters today.

Virgin America President and CEO David Kush said he was also pleased with the deal. “The price paid is a big win for our shareholders,” he said.

The deal involves a cash purchase of Virgin America’s shares at $57 each, which is a 47 percent premium over Friday’s closing price. The merger was approved by the boards of both airlines, but still must face U.S. regulatory approval. That’s expected to be worked out by the end of the year.

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Alaska Air closes in on Virgin America deal

A smiling Eskimo graces the tail of an Alaska Airlines jet. (Credit: Alaska Air)

Seattle-based Alaska Air Group is close to a $2 billion deal to purchase Virgin America, beating out a rival bid from Jet Blue Airways, The Wall Street Journal reported April 2.

The Journal’s report was based on information from unnamed sources said to be familiar with the matter. Those sources stressed that there was no guarantee Alaska would clinch the deal. An announcement could come as early as April 4, they told the Journal.

U.S.-based Virgin America is separate from Virgin Atlantic, a larger airline owned by British billionaire Richard Branson’s Virgin Group. Branson’s holding company owns less than 25 percent of Virgin America, in accordance with federal law. Cyrus Aviation Holdings is the largest investor with about 28 percent of the voting stock.

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