Mesa Air Group, Inc. (MESA), Monday announced a definite agreement with Republic Airways Holdings Inc., creating a regional carrier that continues to connect communities across America. The financial details of the transaction have not been disclosed.
The combined entity will be known as Republic Airways Holdings Inc. and is expected to remain NASDAQ-listed under the new ticker symbol 'RJET'.
Upon the closing of the merger, Republic shareholders will own 88 percent of the combined company's common shares, whereas Mesa shareholders will own a minimum of 6 percent, and up to 12 percent of the combined company dependent upon the latter's achievement of certain pre-closing criteria.
The combined company is expected to produce revenues of approximately $1.9 billion, pretax margins of 7-9 percent, excluding one-time merger and integration costs, and adjusted EBITDA in excess of $320 million.
The pro forma cash and debt balances post-merger are forecasted to be $285 million and $1.1 billion, respectively, the company stated.
Notably, Republic will continue to support American Airlines, Delta Air Lines, and United Airlines under its existing capacity purchase agreements, and Mesa's operations will support United Airlines under a new 10-year capacity purchase agreement.
The transaction is estimated to close in either the late third or early fourth quarter of 2025.
In the pre-market hours, Mesa's stock is climbing 18.29 percent, to $0.84 on the Nasdaq.
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