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Alaska Air Agrees to Buy Virgin America for $2.6 Billion

  • Transaction boosts California presence, opens up New York
  • Deal follows `hard-fought battle' by JetBlue, Alaska CEO says
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Alaska Air to Buy Virgin America in $4 Billion Deal

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Alaska Air Group Inc. agreed to buy Virgin America Inc. for $2.6 billion, defying recent history by uniting two financially stable carriers and picking up access to valuable markets in California and key airports in New York and Washington.

Alaska Air, which first approached Virgin America about a deal last fall, had to overcome competition from JetBlue Airways Corp. to secure the deal. It will pay $57 a share for Virgin America stock, a 47 percent premium to its closing price April 1 and 86 percent above its value March 22, the day before Bloomberg News first reported a possible deal was in the works. The transaction is valued at about $4 billion including debt and capitalized aircraft operating leases, Seattle-based Alaska said Monday.