Allegiant Travel Co. (ALGT) Acquires Sun Country Airlines (SNCY) for $1.5 Billion
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: seekingalpha
- Transaction Overview: Allegiant Travel Co. has agreed to acquire Sun Country Airlines in a cash-and-stock deal valued at approximately $1.5 billion, including net debt, reflecting ongoing consolidation among U.S. leisure-focused airlines.
- Shareholder Benefits: Under the terms of the agreement, Sun Country shareholders will receive 0.1557 shares of Allegiant common stock and $4.10 in cash per share, implying a value of $18.89 per share, representing a 19.8% premium over Sun Country's closing price of $15.77 on January 9.
- Synergy Expectations: Allegiant anticipates generating $140 million in annual synergies within three years through network optimization, fleet efficiencies, and procurement savings, with the transaction expected to be accretive to earnings per share one year post-closing.
- Operational Integration: Following the transaction, Allegiant will remain the publicly traded parent company, with the combined entity headquartered in Las Vegas while maintaining significant operations in Minneapolis-St. Paul, ensuring no immediate changes to branding, schedules, or ticketing until a single operating certificate is issued.
Analyst Views on ALGT
Wall Street analysts forecast ALGT stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for ALGT is 71.56 USD with a low forecast of 55.00 USD and a high forecast of 85.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
9 Analyst Rating
3 Buy
5 Hold
1 Sell
Hold
Current: 92.470
Low
55.00
Averages
71.56
High
85.00
Current: 92.470
Low
55.00
Averages
71.56
High
85.00
About ALGT
Allegiant Travel Company is a leisure travel company focused on providing travel and leisure services and products to residents of under-served cities in the United States. The Company provides various travel services and products, including scheduled service air transportation, ancillary air-related products and services, third party products and services, and fixed-fee contract air transportation. The Company operates through Airline segment.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
