Alaska Air Group and Virgin America are said to delay their $2.6 billion proposed tie-up to give the US Department of Justice additional time to assess the proposal, Bloomberg reported, citing a person familiar with the matter.
The airlines had originally agreed not to close until Sept. 30, effectively setting a deadline for regulators to make their decision.
Airline representatives met with antitrust division chief Renata Hesse and other officials last week to address the government’s concerns that the transaction may pose a risk to competition, Bloomberg previously reported, citing a person familiar with the situation. A high-level meeting such as that may be a sign that regulators are considering a lawsuit to try to block the merger, according to the Bloomberg report.
The shares in Alaska Air were down 0.2% on Friday afternoon in New York, while Virgin America shares were down 0.4% after sliding more than 4% on Thursday.