The US regional airline Republic Air holdings plan to combine it with its financially competing competitor, Mesa Air Group, to create a new public company controlled by the Republic's management team.
The company disclosed its plans on April 7, saying that the total organizations are becoming financially stronger, enjoying a “economy of scale” and are in a better position due to changes in the weather market.
“This will allow for more efficient and productive regional flights and crew resource management,” the airline says. “The strengthened platform is well positioned for valuation lifts, backed by a stronger financial profile, to increase relevance among global institutional investors and improve access to capital markets.”
The US regional aviation market has become increasingly integrated in recent years. The Republic, along with SkyWest Airlines, is one of the biggest players.
The publicly available Mesa Air Group operates Mesa Airlines and fly Embraer E-Jets on behalf of United Airlines. Leading by longtime CEO Jonathan Ornstein, Mesa has struggled financially in recent years and has struggled to hire enough pilots.
The Republic was previously a publicly available company, but was personally detained in 2017 in conjunction with its emergence from Bankruptcy Court protections. Flying on behalf of American Airlines, Delta Air Lines and United.
The Republic is led by CEO Brian Bedford, who was recently appointed by US President Donald Trump to lead the Federal Aviation Administration.
The company is aiming to close transactions “in the second half of 2025 or the fourth quarter,” and has emerged as a public company that holds Republic Airlines' prestigious reputation.
Once closed, the Republic's shareholders own 88% of the total organization. MESA's current shareholders own 6-12% and “rely rely on achieving MESA with certain pre-closure criteria,” the company says.
They don't specify these criteria, but they say the combined entities will continue to fly for America, Delta and United.
MESA currently operates 60 E175 regional jets and stores 33 MHIRJ CRJ900s, while the Republic has flew 31 E170 and 177 E175s and has ordered 40 E175s. The company says it will operate around 1,250 flights daily using a fleet made up of around 310 electronic jets, totaling it.
They are initially intended to fly under separate operating certificates, but ultimately they merge under a single certificate.
“Today's announcement is an exciting next step in Mesa's 40-year history and represents the best results for shareholders, employees and all stakeholders,” says Ornstein, Mesa CEO.
“By putting together the best of the organization, we will create a local airline that will continue to connect American communities while providing employees with promotion opportunities.”
The combined companies will “have financial strength and flexibility, make important investments, promote sustainable profitability and continue to provide best-in-class customer service under a unified brand,” the airline adds.
They forecast that the total company will generate $1.9 billion in annual revenue and provide a pre-tax profit margin of 7-9%.
