ALK Alaska Air Group Inc

Alaska Air Group Inc. said Monday it agreed with the Justice Department that it won't consummate its planned merger with Virgin America Inc. before Oct. 17, an extension of the earlier date of Friday, to give regulators more time to review the deal.

The Seattle-based parent of Alaska Airlines confirmed on Friday that it agreed to give the Justice Department more time, but it didn't specify a duration. The company said Monday it could close earlier than Oct. 17 if the government concurs in writing.

Alaska said it and Virgin America "are confident" they will address any concerns and obtain regulatory approval to complete the deal, given the pair's largely complementary route networks and the relatively small size of the transaction compared with four recent megamergers that put 80% of domestic capacity in the hands of four large carriers.

However, the company didn't say, as it has in the past, that the two anticipated closing early in the fourth quarter.

The Justice Department couldn't immediately be reached.

Alaska in early April announced a $2.6 billion offer to acquire San Francisco-based Virgin America. The two carriers in mid-May received a request for more information about the deal from antitrust regulators. Soon after that commonplace "second request" for information, the two airlines in June agreed not to close before Friday. On Friday, Alaska said the regulatory review was "progressing as expected."

The combination of Alaska and Virgin American would create the No. 5 U.S. airline by traffic, eclipsing JetBlue Airways Corp., which currently holds that spot. JetBlue participated in the bidding for Virgin America but dropped out when the price rose, saying it was better off growing organically.

Write to Susan Carey at susan.carey@wsj.com

(END) Dow Jones Newswires

September 26, 2016 08:55 ET (12:55 GMT)

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