American regional airlines Republic Airways and Mesa Air Group have entered into a definitive merger agreement to create a new publicly traded company. This merger aims to strengthen both companies' positions in regional air transportation and leverage synergies to streamline operations.
Jonathan Ornstein, Chairman and CEO of Mesa Air, called the merger an "exciting next step" in the company's more than 40-year history. He emphasized that this combination represents "the best outcome for our shareholders, employees, and all of our stakeholders." Bryan Bedford, President and CEO of Republic Airways, echoed this sentiment, saying, "Republic and Mesa share a common mission to connect communities across America, and we believe we can better achieve that mission together."
The newly formed company will be called Republic Airways Holdings and is expected to be listed on the NASDAQ under the new ticker symbol "RJET." The merger was unanimously approved by the boards of directors of both companies and is expected to close in the late third or early fourth quarter of 2025. Upon completion of the transaction, Republic Airways shareholders will own approximately 88% of the new company, while Mesa shareholders will own between 6% and 12%, depending on certain pre-closing criteria.
Republic Airways, based in Indianapolis, operates a fleet of over 240 Embraer 170 and 175 aircraft, primarily serving hubs in the Northeast and Mid-Atlantic regions of the United States. In 2024, Republic carried approximately 17,5 million passengers on more than 300.000 flights. The company operates exclusively under long-term capacity purchase agreements with American Airlines, Delta Air Lines, and United Airlines.
Founded in 1982, Mesa Air Group serves 89 cities in 40 states, as well as destinations in the Bahamas, Canada, Cuba, and Mexico. The company operates a fleet of 60 Embraer 175 aircraft with more than 250 daily departures and employs approximately 1.700 people. Mesa has undergone significant changes in recent years, including ending its long-standing partnership with American Airlines in 2023 in favor of a new agreement with United Airlines.
As part of the merger, Republic Airways will continue to support American Airlines, Delta Air Lines, and United Airlines under its existing capacity purchase agreements. Mesa's operations will support United Airlines under a new ten-year capacity purchase agreement. This strategic alignment is intended to improve regional connectivity and increase operational efficiency by combining the resources and expertise of both companies.
Financial details of the transaction were not fully disclosed, but it was announced that all of Mesa's outstanding debt will be eliminated as part of the merger. This is expected to strengthen the combined company's financial position and allow it to benefit from Republic's stable revenues and solid cash flow.
The merger comes at a time when regional airlines in the U.S. are facing challenges such as pilot shortages and rising operating costs. Through the merger, Republic and Mesa hope to increase their competitiveness and improve their ability to effectively serve communities across the United States.
It's worth noting that Bryan Bedford, the former CEO of Republic Airways, was recently nominated by President Donald Trump to be the new head of the Federal Aviation Administration (FAA). This appointment could potentially impact the regulatory landscape in which the merged company operates.
The merger between Republic Airways and Mesa Air Group represents a significant step in the consolidation of the regional air transportation market in the United States. By combining their fleets, resources, and expertise, the two companies are well positioned to meet the future challenges of the industry and enhance service to passengers in the communities they serve.