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Friday, February 3, 2023

Jetblue wins Frontier in Spirit takeover

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MIRAMAR/NEW YORK – US airline Jetblue has come out on top against rival Frontier Airlines in the fight to take over competitor Spirit. After Spirit shareholders declined to back Frontier’s offer, Spirit and Jetblue announced an acquisition agreement on Thursday.

Thus, Jetblue offers nearly 3.8 billion US dollars (3.7 billion euros) in cash for the acquisition of Spirit. Depending on the duration of the purchase, Jetblue will go further. The day before, Spirit and Frontier had terminated their merger agreement.

Spirit actually accepted an offer from Frontier Airlines for $2.9 billion in cash and stock in February. Then Jetblue stepped in with a higher offer. However, Spirit’s board preferred Frontier’s lower offer because they did not believe antitrust authorities would approve a deal with Jetblue.

If shareholders and antitrust authorities play along, Jetblue and Spirit will become a 458-aircraft airline, which has also ordered 300 new machines from Airbus. The two companies expect to close no later than mid-2024. Jetblue expects the acquisition to result in annual cost savings of between $600 million and $700 million.

According to Jetblue boss Robin Hayes, the merger should even promote competition in American air traffic. “By allowing Jetblue to grow faster, we can partner with incumbent carriers in more places to lower fares,” he said. Even together, Spirit and Jetblue are still significantly smaller than the country’s four largest airlines, which dominate 80% of the market.

© dpa | Illustration: Airbus | 28/07/2022 14:04

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Source aero.de

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