Southwest Airlines to buy rival US carrier AirTran
Low-cost US carrier Southwest Airlines is buying AirTran Airways in a deal worth $3.4bn (£2bn) including debts.
Southwest said that the deal took the airline into several new key airports in the US, as well as leisure markets in the Caribbean and Mexico.
The deal is the latest consolidation move in the US aviation sector.
Last week, shareholders in Continental Airlines and United Airlines approved the companies' merger, creating the world's biggest carrier.
Under the deal, Southwest will pay $1.4bn - including $670m in cash - and take on AirTran's debts of $2bn.
The companies said in a statement that the merged carrier would operate from more than 100 airports and serve more than 100 million customers.
The deal takes Southwest into New York's LaGuardia airport and Boston's Logan, plus many other smaller US cities.
Gary Kelly, Southwest's chairman and chief executive, said: "The acquisition of AirTran represents a unique opportunity to grow Southwest Airlines' presence in key markets we don't yet serve and takes a significant step towards positioning us for future growth."
If the takeover gets shareholder and regulatory approval, the deal is expected to close in the first half of next year.