Allegiant to Acquire Sun Country in $1.5 Billion Deal Creating Leisure Giant

Allegiant Travel has agreed to acquire rival leisure carrier Sun Country Airlines in a $1.5 billion cash-and-stock transaction, a move that would reshape the U.S. budget airline sector as carriers grapple with rising costs and intensifying competition in domestic markets.

The deal, announced Sunday Dec 11, includes Sun Country’s net debt of approximately $400 million and values the Minneapolis-based airline at an implied $18.89 per share. That represents a premium of nearly 20% over Sun Country’s closing share price of $15.77 on Friday. Allegiant shareholders will own about 67% of the combined company, while Sun Country shareholders will hold the remaining 33%.

“Our two complementary airlines will create the leading, more competitive, leisure-focused airline in the U.S.,” Allegiant CEO Greg Anderson said, emphasizing that the merger would strengthen both carriers’ ability to serve cost-conscious vacation travelers.

Both airlines operate under an ultra-low-cost model and focus heavily on leisure destinations, particularly sun-and-beach markets. Allegiant is based in Las Vegas, while Sun Country operates primarily out of Minneapolis. Executives from both companies stressed that there is limited overlap between their route networks, a factor they believe will support regulatory approval.

A key element of the transaction is Sun Country’s charter and cargo business, including its growing flying operation for Amazon. Anderson said the Amazon partnership was a critical component of the deal, adding that leaders from both airlines discussed the proposed merger with Amazon in advance.

The acquisition comes as U.S. budget airlines face sustained pressure from higher labor, fuel, and maintenance costs following the pandemic, alongside a surge in domestic capacity that has weighed on fares. Consolidation has long been viewed as a potential path to improved scale and cost efficiency in the segment.

The deal will test the current administration’s stance on airline mergers. While regulators have taken a tougher view on consolidation in recent years, Allegiant expressed confidence that the transaction will be approved, citing the airlines’ complementary business models and minimal competitive overlap. The companies expect the deal to close in the second half of the year, subject to regulatory and shareholder approvals.

Allegiant first approached Sun Country in late fall, according to Anderson. If the transaction is completed, he would become CEO of the combined airline. Sun Country CEO Jude Bricker, who previously served as Allegiant’s chief operating officer, would join Allegiant’s board of directors.

Industry analysts continue to speculate about further consolidation among U.S. low-cost carriers. While previous discussions between Spirit Airlines and Frontier Airlines did not result in a merger, observers say the Allegiant–Sun Country deal could reignite broader debate about the future structure of the budget airline market.

Combined Fleet (Post‑Merger)

Here is a recap of Allegiant Air and Sun Country Airlines based on the latest reporting. The news is dominated by their January 2026 merger announcement, which also provides the clearest picture yet of their combined fleet and route networks.

The merged airline will operate: ~195 aircraft total
Allegiant’s new 737-7 and 737 Max 200 fleet
Allegiant’s remaining A319, A320 aircraft (until fully retired)
Sun Country’s 737‑800, 737-900ER passenger and 737-800BCF cargo aircraft
The combined network will serve:
~175 cities
650+ routes

Executives from both airlines are scheduled to discuss the transaction in more detail during a joint conference call on Monday morning, as investors and regulators assess what would become one of the most significant U.S. airline deals in recent years.

Sources: AirGuide Business airguide.info, bing.com, reuters.com, apnews.com