AK Air reportedly close deal to purchase Virgin America

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Source:   —  April 03, 2016, at 7:49 PM

AK Air Grouping appears to be in line to pay more than $2 billion to acquire Virgin America.

AK Air reportedly close deal to purchase Virgin America

AK Air Grouping appears to be in line to pay more than $2 billion to acquire Virgin America.

AK Air is poised to top a tender by JetBlue (JBLU), according to the Wall Str Journal. AK Air and JetBlue have been said to be in a bidding war for Virgin America. The companies didn't reply to requests for comment.

The acquisition would label yet another step in consolidation in the airline business. AK Air is the eighth biggest U. S.-based airline in terms of traffic, according to the Dept of Transportation's two thousand fifteen data.

Virgin America was launched in two thousand-seventh by billionaire Richard Branson and went public in November two thousand fourteen.

As of December two thousand fifteen, Branson'south Virgin Grouping owned 18.2%. That makes it Virgin America'south second largest shareholder behind NY hedge fund Cyrus Holdings, which has a 27.9 percent stake.

Shares of Virgin America (VA) have jumped since news broke late latest mo that it was looking to sell.

The company has boasted appealing earnings recently. Latest quarter, Virgin America reported a $191 million profit -- a six hundred percent expand from $28 million the year before.

Related: A hassle-free way to check bags at the airport

Virgin America, based in San Francisco, has also been adding more flights and has increased ticket prices. It flies to twenty-two destinations in the U. S. and Mexico.

AK Air Group (ALK) -- which owns AK Airlines and Horizon Air Industries -- is based in Seattle and travels to more than ninety cities in the U. S., Canada and Mexico.

-- CNNMoney'south Chris Isidore contributed to this report.

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