HONOLULU (Reuters) - Billionaire Oracle CEO Larry Ellison may be interested in acquiring a second Hawaii airline after he bought most of the tropical island of Lanai last year.
Island Air, a Honolulu-based carrier with a handful of island-hopping planes that Ellison bought in February, confirmed discussions between Island and Phoenix-based Mesa Air Group, the parent company of Hawaii’s interisland go! Airlines.
“We are committed to building a strong regional airline and part of that process is exploring all options including discussions with Mesa Air,” Island Air Chief Executive Officer Paul Casey said in a one-sentence statement.
Honolulu’s Star-Advertiser newspaper reported on Thursday that Ellison was arranging to take control of go! Airlines, citing an unnamed source familiar with the deal.
Mesa CEO Jonathan Ornstein was not immediately available for comment. A spokeswoman said the airline flies 40 flights a day in Hawaii using a fleet of five 50-seat CRJ-200 jets.
Oracle declined to comment.
Hawaii aviation historian Peter Forman said a deal for Island Air to purchase go! would not only secure more flights for Ellison’s island of Lanai, but also could indicate that Ellison intends to become a player in the Hawaiian airline market.
Many industry observers have expected another airline to enter Hawaii to compete with Hawaiian Airlines for the tourist- rich interisland market. Combining go! and Island Air would give Ellison critical mass and a platform from which to compete.
“He’s gaining the recognition that he is serious about becoming the second interisland airline in Hawaii. There has been a vacuum for serious competition to Hawaiian (Airlines),” Forman said.
In March 2013, Forbes Magazine listed Ellison, 68, as the world’s fifth richest man, and the third richest American, with a net worth of $43 billion.
Ellison bought 98 percent of the 141-square-mile (365-square-km) island of Lanai, Hawaii’s sixth-largest island, from billionaire David Murdock in June for an undisclosed price. He said he intended to turn the island into a “laboratory” for green living.
Ellison’s Lanai holdings include two resorts and golf courses, a variety of commercial and residential structures, as well as vast acres of undeveloped former pineapple land. The island has roughly 3,000 residents.
Editing by Cynthia Johnston and Lisa Shumaker