May 23, 2024

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Spirit and Frontier Airlines rejected the merger agreement

Spirit and Frontier Airlines rejected the merger agreement

Spirit and Frontier Airlines has declined The proposed merger agreement, leaving room for Spirit’s other suitor, JetBlue, to swoop in and strike a deal, As first reported by CNBC. Shareholders were expected to reject the deal during today’s vote, possibly due to JetBlue’s higher bid, according to Washington Post.

Frontier and Spirit first announced the proposed merger in February, a move that would have combined the two low-cost airlines to create the fifth largest airline in the United States. But not everything went as planned. JetBlue opposed Frontier’s initial $2.9 billion offer With an attractive offer of $3.6 billion Soul later refused. In May, Jet Blue It launched a hostile takeover of Spirit Airlines I kept trying Sweeten the deal by increasing its offer.

“While we are disappointed that we had to finalize the proposed merger with Frontier, we are proud of the dedicated work of our team members on the transaction over the past several months,” said Ted Christie, President and CEO of Spirit Airlines, in a statement. statement. “Going forward, the Spirit board will continue our ongoing discussions with JetBlue as we follow the best path forward for Spirit and our shareholders.”

It’s not clear where things will go from here, as Spirit shareholders still need to agree to the deal with JetBlue, and even then, Spirit executives were not convinced that regulators would allow it. Spirit has raised concerns about JetBlue’s involvement with the North American Alliance (NEA), a partnership that brings together JetBlue and American Airlines services in New York City and Boston.

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The NEA is supposed to make it easier for passengers to board connecting flights from either service, as well as offer more routes to both cities, but the DOJ believes that could hurt the airline industry. Last September, it was The Ministry of Justice filed an antitrust complaint against the NEA last September, arguing that it reduces competition and harms passengers by boosting the airline industry.