September 23, 2016 / 7:15 PM / 3 years ago

Alaska Air says merger with Virgin America still on track

A combination photo shows Virgin America plane (bottom) in San Diego, California on April 4, 2016 and an Alaska Airlines plane (top) at San Francisco, California on April 14, 2015 respectively. REUTERS/Files

(Reuters) - Alaska Air Group Inc (ALK.N) agreed this week to give the U.S. Justice Department additional time to review its merger with Virgin America Inc VA.O, but the deal is still on track to close in the early part of the fourth quarter, an Alaska spokeswoman said Friday.

Alaska Airlines reached an understanding with the U.S. regulator earlier this year not to close the merger prior to Sept. 30, which has not changed, the airline’s spokeswoman Bobbie Egan said in a statement.

“Given our largely complementary networks, the relative size of this merger compared to past airline combinations, and both Virgin America and Alaska’s reputations for being customer service-focused airlines, we continue to feel confident that the (Justice Department) will agree that our combination will allow us to better compete against the Big Four airlines,” Egan said, referring to American (AAL.O), Delta (DAL.N), United UAL.N and Southwest (LUV.N).

Bloomberg News reported earlier Friday that the airlines agreed to delay merger plans to give the U.S. Justice Department additional time, adding that they met with government officials last week to address their concerns about industry competition.

Egan said Bloomberg’s report that the Justice Department “can now take several more weeks” for the review was inaccurate.

The Seattle-based company announced its $2.6 billion cash deal for Virgin America in April, which will make it the top carrier on the U.S. West Coast if the merger is approved.

Shares of Alaska Air were down less than 1 percent in afternoon trade.

Reporting by Jeffrey Dastin in New York, editing by G Crosse and Chizu Nomiyama

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