With JetBlue off the list, Frontier and Spirit Airlines are again discussing a merger — two years after their $2.9 billion deal fell through
Spirit AirlinesStill reeling from its failed merger with JetBlue, it may have found another suitor.
The Wall Street Journal reported Frontier Airlines is considering a bid for the discount airline—and if it’s causing a feeling of déjà vu, there’s good reason. The two airlines had reached a $2.9 billion acquisition deal in 2022, but that deal fell apart when JetBlue created a major competition.
In fact, over the past eight years, Spirit Airlines and Frontier Airlines have been a “like it or not” couple in the airline industry, having discussed a merger multiple times.
Negotiations, said magazineis in the early stages and may not result in bids. Much of that may depend on Spirit’s continued efforts to restructure its debt. The airline is considering filing for Chapter 11 bankruptcy
Spirit shares jumped 27% in early trading Wednesday following the news.
Spirit Airlines has not posted an annual profit since before Covid. That has resulted in the carrier taking on a significant amount of debt. It reached a deal to be acquired by JetBlue, but the Justice Department blocked that merger, saying it would harm consumer choice and lead to higher fares.
Spirit has $3.3 billion in debt coming due. The carrier has until just before the end of the year to refinance $1.1 billion in secured bonds. If it fails to do so, it may lose its ability to process credit card transactions.
Spirit has cut dozens of routes for the upcoming holiday season and laid off 186 pilotsas well as provided incentives for customerssuch as launching a business class option and blocking middle seats.
Meanwhile, Frontier hopes that a merger with Spirit could help it compete better with larger airlines like Delta, United and American, which are increasingly taking market share from low-cost carriers. cheap.
Spirit declined to comment on the reports. Frontier did not immediately respond Luckrequest for comment by.
