Airline merger: Frontier sweetens offer for Spirit Airlines

Jun 24, 2022, 3:17 PM | Updated: Jun 25, 2022, 1:58 am
FILE - A line of Spirit Airlines jets sit on the tarmac at Orlando International Airport on May 20,...

FILE - A line of Spirit Airlines jets sit on the tarmac at Orlando International Airport on May 20, 2020, in Orlando, Fla. Frontier Airlines on Friday, June 24, 2022, added more cash and a larger breakup fee to its offer to buy Spirit Airlines, and the Spirit board repeated its preference for Frontier over a rival bid by JetBlue Airways. (AP Photo/Chris O'Meara, File)

(AP Photo/Chris O'Meara, File)

Frontier Airlines on Friday added more cash and a larger breakup fee to its offer to buy Spirit Airlines, and the Spirit board repeated its preference for Frontier over a rival bid by JetBlue Airways.

Frontier added $2 per share to its previous offer, boosting it to $4.13 in cash plus 1.9126 shares of Frontier for each Spirit share.

The Denver-based airline also raised the amount it would pay Miramar, Florida-based Spirit if antitrust regulators stop the deal — from $250 million to $350 million — matching JetBlue’s proposed breakup fee.

Spirit said that, given the sweetened terms, its board reiterated its unanimous recommendation that shareholders approve the Frontier offer at a special meeting next Thursday.

JetBlue said its proposal remains better than Frontier’s with a higher value, more cash, “more certainty, and more regulatory protections.”

Frontier’s move was the latest gambit in a fight between Frontier and JetBlue to see who gets the nation’s largest discount airline. On Monday, New York-based JetBlue raised its all-cash offer to $33.50 per share, or more than $3.6 billion.

At current value, JetBlue’s proposal is worth more. JetBlue proposes to buy all Spirit shares and reconfigure the budget airline’s planes into JetBlue’s less-cramped layout.

Frontier’s stock-and-cash offer would give Spirit shareholders 48.5% of the new, combined airline — which does not yet have a name. That means investors willing to hold the stock could come out ahead if the shares rise enough in price.

Spirit’s board has cited another reason for favoring Frontier, which, like Spirit, is an ultra-low-cost carrier that charges rock-bottom fares but also many extra fees. Spirit has maintained that antitrust regulators are very unlikely to let JetBlue buy Spirit and remove its low fares from the market.

JetBlue disputes Spirit’s conclusion. It bypassed Spirit’s board and appealed directly to Spirit shareholders to reject the Frontier offer.

Frontier and JetBlue agree on one thing: Both say that buying Spirit would make them a stronger competitor to the nation’s four leading airlines, American, Delta, United and Southwest.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

Associated Press

In your debt: 3 steps to lower the cost of your debt

Does the thought of dealing with your debt make you want to go back to bed? More than 1 in 5 Americans (22%) are likely to put off creating a debt payoff plan, according to a June 2022 survey from NerdWallet conducted online by The Harris Poll. That’s a lot of procrastination, and it’s no […]
9 hours ago
Associated Press

Authorities: Texas man shoots 2 migrants near Mexico border

AUSTIN, Texas (AP) — Two brothers — including one who has been a warden at a detention center that has housed immigrants — have been arrested in Texas after authorities say one of them opened fire on a group of migrants getting water near the U.S.-Mexico border, killing one man and shooting a woman in […]
9 hours ago
FILE - Federal Reserve Board Vice Chair Lael Brainard speaks during a conversation with leaders fro...
Associated Press

Brainard warns US rates to stay high, notes global impact

WASHINGTON (AP) — Federal Reserve Vice Chair Lael Brainard said Friday that U.S. interest rates will likely have to remain high for an extended period to combat inflation, capping a week of tough rhetoric by Fed officials. In remarks at a conference hosted by the Federal Reserve Bank of New York, Brainard said that international […]
9 hours ago
FILE - In this June 22, 2017 file photo, Texas Attorney General Ken Paxton speaks at a news confere...
Associated Press

Dysfunction in Texas AG’s office as Paxton seeks third term

GATESVILLE, Texas (AP) — Texas Attorney General Ken Paxton’s staff this month quietly dropped a series of human trafficking and child sexual assault cases after losing track of one of the victims, a stumble in open court emblematic of broader dysfunction inside one of America’s most prominent law offices. The Republican has elevated his national […]
9 hours ago
Bulgarian President Rumen Radev, right, flanked by President of Azerbaijan Ilham Aliyev during his ...
Associated Press

Azerbaijan to increase gas deliveries to Bulgaria, Europe

SOFIA, Bulgaria (AP) — Azerbaijan’s president said Friday that his country is a reliable partner and will stick to an agreement to double gas exports to the European Union by 2027. Speaking to reporters in Bulgaria’s capital, President Ilhan Aliyev called a new gas interconnector with Greece “a historic achievement and an opportunity for Azeri […]
9 hours ago
FILE - President Joe Biden speaks about Hurricane Ian during a visit to FEMA headquarters, Sept. 29...
Associated Press

US hits Russia with sanctions for annexing Ukrainian regions

WASHINGTON (AP) — The U.S. on Friday sanctioned more than 1,000 people and firms connected to Russia’s invasion of Ukraine, including its Central Bank governor and families of Security Council members, after President Vladimir Putin signed treaties absorbing occupied regions of Ukraine into Russia, in defiance of international law. The Treasury Department named hundreds of […]
9 hours ago

Sponsored Articles

...
Sanderson Ford

Don’t let rising fuel prices stop you from traveling Arizona this summer

There's no better time to get out on the open road and see what the beautiful state of Arizona has to offer. But if the cost of gas is putting a cloud over your summer vacation plans, let Sanderson Ford help with their wide-range selection of electric vehicles.
...
Dr. Richard Carmona

Great news: Children under 5 can now get COVID-19 vaccine

After more than two years of battle with an invisible killer, we can now vaccinate the youngest among us against COVID-19. This is great news.
(Courtesy Condor)...
Condor Airlines

Condor Airlines shows passion for destinations from Sky Harbor with new-look aircraft

Condor Airlines brings passion to each flight and connects people to their dream destinations throughout the world.
Airline merger: Frontier sweetens offer for Spirit Airlines