Spirit Airlines is advising shareholders to reject a tender offer for shares from JetBlue three days after it went hostile in its bid to create what would be the nation’s fifth largest airline
By MICHELLE CHAPMAN AP Business Writer
19 May 2022, 11:51
• 2 min read
Share to FacebookShare to TwitterEmail this articleSpirit Airlines is advising shareholders to reject a tender offer for shares from JetBlue three days after it went hostile in its bid to create what would be the nation’s fifth largest airline.
Spirit repeated Thursday that any attempt to merge with the New York carrier would face substantial regulatory hurdles, largely because of JetBlue's alliance with American Airlines in the Northeast. The Justice Department is suing to block that deal.
JetBlue is in “the middle of a merger with American Airlines, one of the big three that they purport to compete with, and then attempting to buy a competitor and take seats out of the market and raise fares and that’s going to be a big issue and one that our board viewed as insurmountable," CEO Edward Christie told CNBC.
JetBlue offered to buy Spirit Airlines after a proposed acquisition of that carrier by Frontier Airlines, a deal that Spirit is backing despite a lower offering price.
On Monday JetBlue launched a hostile takeover bid for Spirit, directly asking shareholders of the low-cost carrier to vote down a tie-up with Colorado's Frontier Group Holdings Inc.
The offer Monday from JetBlue was for $30 per share in cash, or more than $3.2 billion, but said its April 5 offer of $33 per share is still available if Spirit enters negotiations.
Spirit’s board rejected JetBlue’s original $3.6 billion bid on May 2.
Shareholders of Spirit, based in Miramar, Florida, are scheduled to vote June 10 on the cash-and-stock offer from Frontier, worth about $2.9 billion when announced in February.
Shares of Spirit, JetBlue and Frontier all declined slightly before the market open.
