On 7 April 2025, Republic Airways Holdings Inc. and Mesa Air Group, Inc. revealed plans to merge, creating a powerhouse in the U.S. regional airline sector.
This all-stock transaction will see the combined entity renamed Republic Airways Holdings Inc., trading on NASDAQ under the ticker “RJET.” The merger unites two operators with a shared focus on connecting underserved communities in the United States. The combined company will leverage complementary fleets and operational strengths to enhance service reliability and efficiency.
Strategic Vision and Leadership Perspectives
Jonathan Ornstein, Mesa’s Chairman and CEO, hailed the merger as a pivotal moment in the Company’s 40-year legacy. In a statement, he emphasized the benefits for shareholders and employees alike.
“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,” he stated.
Bryan Bedford, Republic’s President and CEO, echoed this sentiment.
“We’re thrilled to combine the Republic and Mesa teams to create one of the world’s leading Embraer Jet operators,” Bedford said. “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.”
The synergy aims to establish a well-capitalized entity poised for long-term success.
Fleet and Operational Synergies
REPUBLIC AIRWAYS: A REGIONAL TITAN
Founded in 1974, Republic operates a fleet of over 240 Embraer E170/E175 aircraft. The carrier logged 591,000 block hours and served 17.5 million passengers in 2024. Based at Indianapolis International Airport (IND), Republic operates primarily across the Northeast and Mid-Atlantic. The carrier flies exclusively under capacity purchase agreements (CPAs) with American Airlines, Delta Air Lines, and United Airlines. With 15 new E175s slated for delivery in 2025, all debt-financed, Republic’s operational scale is set to grow further.
MESA AIR GROUP: WESTERN REACH
Established in 1982, Mesa complements Republic with its 60 E175s, operating over 250 daily departures across 89 cities. Headquartered in Phoenix, Mesa flies solely as United Express under a CPA with United Airlines. The merger will consolidate these operations into a unified fleet of approximately 310 E-Jets, maintaining existing basing structures and over 1,250 daily departures.
Combined Network Benefits
The merger enhances economies of scale, optimizing crew resource management and regional flying efficiency. The combined network will continue supporting American, Delta, and United under existing and new CPAs, including a 10-year United agreement for Mesa’s operations post-merger. A single FAA operating certificate will streamline regulatory compliance.
Financial Outlook and Stability
In 2024, Republic reported $1.5 billion in revenue and $65 million in net income, with an EBITDA of $254 million. Mesa’s debt-free contribution to the merger strengthens the combined balance sheet, projecting pro forma revenues of $1.9 billion and an adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) exceeding $320 million.
Post-merger, cash reserves are forecasted at $285 million, with debt at $1.1 billion, yielding a net leverage of 2.5x and liquidity above 15% of revenues. This financial robustness supports investments in service quality and resilience against market volatility.
Cultural and Safety Alignment
Both airlines share a commitment to safety and operational excellence, evidenced by their inclusion in the IATA Operational Safety Audit (IOSA) registry. The merger preserves this ethos, retaining all flight crews, technicians, and operational staff. Republic’s leadership team will helm the combined company, supported by a board featuring six Republic directors and one independent Mesa director, ensuring continuity and expertise.
Transaction Mechanics and Timeline
Republic shareholders will hold 88% of the merged entity, with Mesa shareholders owning 6% to 12%, contingent on pre-closing milestones. Mesa’s debt will be canceled, bolstered by a Three Party Agreement with United Airlines facilitating asset dispositions and liability management.
Approved by both boards, the deal awaits regulatory and shareholder nods, targeting closure in late Q3 or early Q4 2025.
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- Source: https://avgeekery.com/republic-airways-to-acquire-mesa-air-in-landmark-deal/
