Republic Airways and Mesa Air Group to Combine, Creating America's Regional Airline of Choice
Republic Airways Holdings and Mesa Air Group (NASDAQ: MESA) have announced a definitive merger agreement to create America's leading regional airline in an all-stock transaction. The combined entity will operate under the name Republic Airways Holdings Inc. with the ticker symbol 'RJET' on NASDAQ.
The merger will unite a fleet of approximately 310 Embraer 170/175 aircraft, operating over 1,250 daily departures. Republic shareholders will own 88% of the combined company, while Mesa shareholders will own between 6-12% based on pre-closing criteria. The transaction is expected to close in late Q3 or early Q4 2025.
The combined company is projected to generate revenues of approximately $1.9 billion, with pretax margins of 7-9% and adjusted EBITDA exceeding $320 million. The merger will maintain existing partnerships with American Airlines, Delta Air Lines, and United Airlines, with Mesa's operations supporting United under a new 10-year capacity purchase agreement.
Republic Airways Holdings e Mesa Air Group (NASDAQ: MESA) hanno annunciato un accordo di fusione definitivo per creare la principale compagnia aerea regionale americana in una transazione interamente azionaria. L'entità combinata opererà con il nome Republic Airways Holdings Inc. e il simbolo di borsa 'RJET' su NASDAQ.
La fusione unirà una flotta di circa 310 aerei Embraer 170/175, con oltre 1.250 partenze giornaliere. Gli azionisti di Republic possederanno l'88% della società combinata, mentre gli azionisti di Mesa possederanno tra il 6% e il 12% in base a criteri pre-chiusura. Si prevede che la transazione si concluda entro la fine del terzo trimestre o all'inizio del quarto trimestre del 2025.
Si prevede che la società combinata generi ricavi di circa $1,9 miliardi, con margini ante imposte del 7-9% e un EBITDA rettificato che supera i 320 milioni di dollari. La fusione manterrà le partnership esistenti con American Airlines, Delta Air Lines e United Airlines, con le operazioni di Mesa che supporteranno United sotto un nuovo accordo di acquisto di capacità di 10 anni.
Republic Airways Holdings y Mesa Air Group (NASDAQ: MESA) han anunciado un acuerdo de fusión definitivo para crear la principal aerolínea regional de América en una transacción totalmente en acciones. La entidad combinada operará bajo el nombre Republic Airways Holdings Inc. con el símbolo de cotización 'RJET' en NASDAQ.
La fusión unirá una flota de aproximadamente 310 aviones Embraer 170/175, operando más de 1,250 salidas diarias. Los accionistas de Republic poseerán el 88% de la compañía combinada, mientras que los accionistas de Mesa poseerán entre el 6% y el 12% según criterios previos al cierre. Se espera que la transacción se cierre a finales del tercer trimestre o principios del cuarto trimestre de 2025.
Se proyecta que la compañía combinada genere ingresos de aproximadamente $1.9 mil millones, con márgenes antes de impuestos del 7-9% y un EBITDA ajustado que supera los 320 millones de dólares. La fusión mantendrá las asociaciones existentes con American Airlines, Delta Air Lines y United Airlines, con las operaciones de Mesa apoyando a United bajo un nuevo acuerdo de compra de capacidad de 10 años.
Republic Airways Holdings와 Mesa Air Group (NASDAQ: MESA)는 미국의 주요 지역 항공사를 만들기 위한 최종 합병 계약을 발표했습니다. 이 거래는 전량 주식 거래로 이루어집니다. 결합된 법인은 NASDAQ에서 'RJET'이라는 티커 기호로 Republic Airways Holdings Inc.라는 이름으로 운영될 것입니다.
합병은 약 310대의 Embraer 170/175 항공기로 구성된 플릿을 통합하여 하루에 1,250회 이상의 출발을 제공합니다. Republic의 주주들은 결합된 회사의 88%를 소유하게 되며, Mesa의 주주들은 사전 마감 기준에 따라 6%에서 12% 사이의 지분을 소유하게 됩니다. 거래는 2025년 3분기 말 또는 4분기 초에 마감될 것으로 예상됩니다.
결합된 회사는 약 $19억의 수익을 창출할 것으로 예상되며, 세전 마진은 7-9%이고 조정된 EBITDA는 3억 2천만 달러를 초과할 것으로 보입니다. 합병은 American Airlines, Delta Air Lines 및 United Airlines와의 기존 파트너십을 유지하며, Mesa의 운영은 새로운 10년 용량 구매 계약에 따라 United를 지원합니다.
Republic Airways Holdings et Mesa Air Group (NASDAQ: MESA) ont annoncé un accord de fusion définitif pour créer la principale compagnie aérienne régionale d'Amérique dans le cadre d'une transaction entièrement en actions. L'entité combinée opérera sous le nom de Republic Airways Holdings Inc. avec le symbole boursier 'RJET' sur NASDAQ.
La fusion unira une flotte d'environ 310 avions Embraer 170/175, réalisant plus de 1 250 départs quotidiens. Les actionnaires de Republic détiendront 88% de la société combinée, tandis que les actionnaires de Mesa détiendront entre 6% et 12% en fonction des critères de pré-clôture. La transaction devrait se conclure à la fin du troisième trimestre ou au début du quatrième trimestre 2025.
La société combinée devrait générer des revenus d'environ 1,9 milliard de dollars, avec des marges avant impôt de 7 à 9% et un EBITDA ajusté dépassant 320 millions de dollars. La fusion maintiendra les partenariats existants avec American Airlines, Delta Air Lines et United Airlines, les opérations de Mesa soutenant United dans le cadre d'un nouvel accord d'achat de capacité de 10 ans.
Republic Airways Holdings und Mesa Air Group (NASDAQ: MESA) haben eine endgültige Fusionsvereinbarung angekündigt, um die führende regionale Fluggesellschaft Amerikas in einer rein aktienbasierten Transaktion zu schaffen. Das kombinierte Unternehmen wird unter dem Namen Republic Airways Holdings Inc. mit dem Tickersymbol 'RJET' an der NASDAQ tätig sein.
Die Fusion wird eine Flotte von etwa 310 Embraer 170/175 Flugzeugen vereinen, die über 1.250 tägliche Abflüge durchführen. Die Aktionäre von Republic werden 88% des kombinierten Unternehmens besitzen, während die Aktionäre von Mesa je nach Kriterien vor dem Abschluss zwischen 6% und 12% besitzen werden. Die Transaktion wird voraussichtlich Ende Q3 oder Anfang Q4 2025 abgeschlossen sein.
Das kombinierte Unternehmen wird voraussichtlich Einnahmen von etwa 1,9 Milliarden Dollar erzielen, mit einem Vorsteuer-Margen von 7-9% und einem bereinigten EBITDA von über 320 Millionen Dollar. Die Fusion wird bestehende Partnerschaften mit American Airlines, Delta Air Lines und United Airlines aufrechterhalten, wobei die Aktivitäten von Mesa United unter einem neuen 10-jährigen Kapazitätskaufvertrag unterstützen.
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Brings together two highly complementary cultures, fleets, and operations, which will continue to connect communities across America
"Today's announcement is an exciting next step in Mesa's more than 40-year history, one that represents the best outcome for our shareholders, employees, and all of our stakeholders," said Jonathan Ornstein, Mesa's Chairman and Chief Executive Officer. "By bringing the best of our organizations together, we will create a regional carrier that continues to connect communities across America while providing advancement opportunities to our employees."
"We're thrilled to combine the Republic and Mesa teams to create one of the world's leading Embraer Jet operators," said Bryan Bedford, Republic's President and Chief Executive Officer. "Republic and Mesa share a common mission to connect communities across America, and we believe that we can better achieve that mission together. With this combination, we are establishing a single, well-capitalized, public company that will benefit from the deep expertise of Republic and Mesa associates, creating value for all stakeholders well into the future."
Republic Airways Overview
Republic Airways has been a leading regional airline since its inception in 1974 and is now one of the largest regional airlines in
Compelling Strategic Rationale
- Economies of Scale: The proposed combination represents a transformational opportunity to significantly enhance the scale of the combined airlines, both financially, and operationally, with a larger, unified fleet. This will enable more efficient and productive regional flying and crew resource management. The enhanced platform is well positioned for a valuation uplift, supported by a stronger financial profile, increased relevance among global institutional investors, and improved access to capital markets.
- Enhanced Capital and Liquidity Position: Pro forma net leverage at close is expected to be approximately 2.5x and liquidity as a percent of pro forma revenues is expected to be greater than
15% . Together, the combined company will have the financial strength and flexibility to make critical investments, drive sustained profitability, and continue delivering best-in-class customer service under a unified brand. A stronger balance sheet for the combined airline will bolster the Company's ability to navigate market cycles, respond to strategic opportunities, and maintain a flexible capital allocation strategy that optimizes returns for all stakeholders. - Complementary Networks and Operations: The proposed combination represents a unique opportunity to bring together Mesa's and Republic's networks to establish America's regional airline of choice. The post-merger company will maintain a single fleet of approximately 310 Embraer 170/175 ("E-Jet") aircraft, with over 1,250 daily departures, across both airlines' existing flying networks and will operate within Mesa's and Republic's current basing structures and routes. Mesa and Republic will continue to operate under their existing Federal Aviation Administration (FAA) operating certificates until securing a single-operating certificate for the combined airline.
- Synergistic Cultures Rooted in Safety and Reliability: Mesa and Republic share common values and principles, which include an uncompromising focus on providing safe and reliable services for passengers, operational excellence, and a culture which provides career growth and advancement opportunities for associates. Both Mesa and Republic are included in the International Air Transport Association's Operational Safety Audit (IOSA) registry, the internationally recognized standard for airline safety and operational excellence. These principles will be maintained and enhanced by the merger.
- Talented Team Positioned for Exciting Growth Opportunities: The combined company will continue serving key partners, including American Airlines, Delta Air Lines, and United Airlines. The parties expect to retain all flight crews, technicians, and other operational staff within the post-merger entity, which will be led by an experienced and seasoned management team.
Overview of the Combined Company:
Republic will continue to support American Airlines, Delta Air Lines, and United Airlines under its existing capacity purchase agreements ("CPA"), and Mesa's operations will support United Airlines under a new 10-year CPA, as a result of this transaction. The combined company is expected to produce revenues of approximately
Management and Governance
The combined company will be led by Republic's executive leadership team. The Board of Directors will be comprised of six existing directors from the Republic Board of Directors and one independent director from the Mesa Board of Directors.
Transaction Details and Conditions to Close
Upon closing of the transaction, Republic shareholders will own
Concurrently with the execution and delivery of the Merger Agreement, Mesa, Republic and United Airlines, Inc. ("United"), among other parties, entered into a Three Party Agreement (the "Three Party Agreement"), pursuant to which, among other things: (i) Mesa will take certain actions at or prior to the closing of the Merger to dispose of certain assets, extinguish certain liabilities and effectuate certain related transactions; and (ii) United will take certain actions at or prior to the closing of the Merger to facilitate Mesa's actions in the foregoing clause (i).
The transaction has been unanimously approved by the Boards of Directors of both companies and is expected to close in either the late third or early fourth quarter of 2025. The transaction is subject to customary closing conditions, including regulatory and shareholder approvals by both companies.
Advisors
Simpson Thacher & Bartlett LLP is serving as legal counsel and Goldman Sachs & Co. LLC is serving as financial advisor to Republic Airways.
FTI Capital Advisors, LLC is serving as financial advisor to Mesa Air Group. Pachulski Stang Ziehl & Jones LLP and DLA Piper LLP are serving as legal counsel.
Sidley Austin LLP is serving as legal counsel to United.
About Republic Airways Inc.
Founded in 1974, Republic Airways maintains a fleet of more than 240 Embraer 170/175 aircraft and offers scheduled passenger service with more than 1,000 daily scheduled flights to more than 80 cities in the
About Mesa Air Group, Inc.
Founded in 1982 and headquartered in
Forward-Looking Statements
This press release may be deemed to contain forward-looking statements within the meaning of Section 27A of the Securities Act, Section 21E of the Exchange Act, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding the effects of the restatement of Mesa's past financial statements and the filing of Mesa's amended periodic reports. Words such as "future," "anticipate," "believe," "estimate," "expect," "intend," "plan," "may," "might," "predict," "will," "would," "should," "could," "can," "may," or the negative or other variations thereof, and similar words or phrases or comparable terminology, are intended to identify forward-looking statements.
The forward-looking statements contained in this press release reflect Mesa's current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances, many of which are beyond the control of Mesa, that may cause actual results and future events to differ significantly from those expressed in any forward-looking statement, which risks and uncertainties include, but are not limited to: the ability to complete the proposed transaction on the proposed terms or on the anticipated timeline, or at all, including risks and uncertainties related to securing the necessary stockholder approval and satisfaction of other closing conditions to consummate the proposed transaction; the occurrence of any event, change or other circumstance that could give rise to the termination of the Merger Agreement relating to the proposed transaction; risks that the proposed transaction disrupts Mesa's current plans and operations or diverts the attention of Mesa's management or employees from ongoing business operations; the risk of potential difficulties with Mesa's ability to retain and hire key personnel and maintain relationships with customers and other third parties as a result of the proposed transaction; the failure to realize the expected benefits of the proposed transaction; the risk that the proposed transaction may involve unexpected costs and/or unknown or inestimable liabilities; the risk that Mesa's business may suffer as a result of uncertainty surrounding the proposed transaction; the risk that stockholder litigation in connection with the proposed transaction may affect the timing or occurrence of the proposed transaction or result in significant costs of defense, indemnification and liability; effects relating to the announcement of the transaction or any further announcements or the consummation of the transaction on the market price of Mesa Common Stock.
While forward-looking statements reflect Mesa's good faith beliefs, they are not guarantees of future performance or events. Any forward-looking statement speaks only as of the date on which it was made. Mesa disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause Mesa's future results to differ materially from any forward-looking statements, see the section entitled "Risk Factors" in Mesa's Annual Report on Form 10-K for the year ended September 30, 2023, filed with the SEC on January 26, 2024, as amended by Form 10-K/A filed with the SEC on February 27, 2024, as updated by Mesa's subsequent periodic reports filed with the SEC.
Additional Information and Where to Find It
This press release relates to the proposed merger involving Mesa and Republic. In connection with the proposed transaction, Mesa will file with the SEC a Form S-4 Registration Statement, which will include a proxy statement on Schedule 14A. Promptly after filing its definitive proxy statement with the SEC, Mesa will mail the definitive proxy statement and a proxy card to each stockholder entitled to vote at the special meeting relating to the proposed transaction. INVESTORS AND SECURITY HOLDERS OF MESA ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTION THAT MESA FILES WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The definitive proxy statement, the preliminary proxy statement and any other documents filed by Mesa with the SEC (when available) may be obtained free of charge at the SEC's website at www.sec.gov or by accessing the Investor Relations section of Mesa's website at https://investor.mesa-air.com/.
Information Regarding Non-GAAP Financial Measures
This communication contains certain information that is not calculated according to GAAP ("non-GAAP"), such as EBITDA, Adjusted EBITDA and Net Leverage. We believe that investors will find these non-GAAP measures useful in evaluating our performance. These measures are frequently used by security analysts, institutional investors and other interested parties in the evaluation of companies in our industry. Non-GAAP measures should not be considered in isolation or as a substitute for our reported results prepared in accordance with GAAP and, as calculated, may not be comparable to similarly titled measures of other companies. Lastly, this communication also includes certain forward-looking non-GAAP financial measures. We are unable to present a quantitative reconciliation of this forward-looking non-GAAP financial information because management cannot reliably predict all of the necessary components of such measures.
Media Contacts
For Republic Airways
(612) 839-5172
corpcomm@rjet.com
Danielle Fornabaio / Ashley Grund of Gladstone Place Partners
212-230-5930
For Mesa Air Group
(602) 685 4010
Investor.relations@mesa-air.com
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SOURCE Republic Airways Inc.; Mesa Air Group, Inc.