The U.S. Department of Transportation approved a joint interim exemption allowing Allegiant Travel Company (NASDAQ: ALGT) and Sun Country Airlines Holdings (NASDAQ: SNCY) to operate as separate carriers under common ownership following the completion of their proposed merger.

The DOT approval satisfies the final regulatory condition required for closing the transaction. Both airlines will continue operating independently while working toward a single operating certificate, according to a press release from the companies.

"This approval underscores the strength of our shared vision and the thoughtful approach both teams have taken throughout this process," said Gregory C. Anderson, CEO of Allegiant.

Jude Bricker, President and CEO of Sun Country, stated the milestone allows the companies "to move forward with confidence while continuing to serve our customers and communities without disruption."

The closing remains subject to shareholder approval from both companies. Special shareholder meetings are scheduled for May 8, 2026. Subject to satisfying remaining closing conditions, the companies expect the transaction to close as early as May 13, 2026.

Under the approved structure, both airlines will maintain their existing business models, route networks, and customer experiences during the transition period. The companies stated this approach will ensure operational continuity while positioning the combined entity for future integration.

Las Vegas-based Allegiant operates an integrated travel business focused on connecting small-to-medium cities to vacation destinations with nonstop flights. Minneapolis-based Sun Country provides passenger, charter, and cargo services throughout the United States and to international destinations.