Allegiant and Sun Country Airlines announced a merger agreement under which Allegiant will acquire Sun Country in a cash and stock transaction valued at approximately $1.5 billion, inclusive of $0.4 billion of Sun Country’s net debt. Upon closing, Allegiant and Sun Country shareholders will own approximately 67% and 33%, respectively, of the combined company.

The combination, said the announcement, will create “a leading leisure-focused US airline,” expanding service to more popular vacation destinations across the US as well as international destinations, and providing more people with access to affordable, convenient air travel.

Allegiant and Sun Country, said the announcement, are well positioned to create one of the most adaptable and resilient airline models in the industry, with the ability to respond quickly to changing market conditions, traveler demand, and charter and cargo partner needs. The combination of two financially strong leisure carriers in the US, said the announcement, will create benefits for customers, communities, employees and partners by enhancing stability, expanding opportunities and enabling continued investment and innovation.

Gregory Anderson, Allegiant CEO, said, “This combination is an exciting next chapter in Allegiant and Sun Country’s shared mission in providing affordable, reliable and convenient service from underserved communities to premier leisure destinations.”

Jude Bricker, Sun Country CEO, said, “Today marks an exciting next step in our history as we join Allegiant to create one of the leading leisure travel companies in the US.” He added, “We are two customer-centric organizations, deeply committed to delivering affordable travel experiences without compromising on quality.”