DoJ green lights Southwest Airlines’ acquisition of AirTran
Southwest Airlines has been cleared to complete its acquisition of AirTran after an investigation found the deal was “not likely to substantially lessen competition”.
Officials at the American Department of Justice found the merged firm would be able to offer new service on routes that neither serves today.
These included new connecting service through Atlanta’s Hartfield Jackson international Airport from cities currently served by Southwest to cities currently served by AirTran.
The DoJ also confirmed the presence of low cost carriers like Southwest and AirTran has been shown to lower fares on routes previously served only by incumbent legacy carriers.
“Although there are overlaps on certain non-stop routes, the division did not challenge the acquisition after considering the consumer benefits from the new service,” read a DoJ statement.
“Also, the airports affected by the overlaps are not subject to restrictions on slots or gate availability.
“Where such restrictions exist, entry by other airlines may be particularly difficult.”
About the Airlines
Southwest Airlines is based in Dallas.
In 2010, it had revenues of $12.1 billion carrying approximately 88 million passengers.
Southwest serves 72 cities in the United States.
AirTran is based in Orlando.
In 2010, it had revenues of $2.6 billion carrying approximately 25 million passengers.
AirTran serves 69 cities in the United States, Mexico and the Caribbean.
The merger is now expected to close in early May.