New York’s JetBlue and Spirit Airlines LaGuardia International Airport Terminal A.
Leslie Joseph | CNBC
Frontier Sweetened the offer On Friday. Spirit CEO Ted Christie said on Tuesday that the airline’s board of directors is still better off contracting with the low-cost carrier Frontier than using JetBlue.
Spirit shareholders will vote for Frontier cash and equity transactions on Thursday. Spirit postponed voting earlier this month and continued negotiations with both airlines.
Both combinations create the fifth largest aircraft carrier in the United States. The fierce bidding war emphasizes that both JetBlue and Frontier see spirit as the key to future growth plans when there is a shortage of planes and pilots.
Spirit argued that it did not expect JetBlue’s transaction to go through regulatory consultations, especially due to its partnership with JetBlue. American Airlines In the northeast.
“After the Spirit Board did not recognize our decisively superior offer, we discussed our offer directly with the Shareholders of Spirit and are now confident that they will respond to the expressed interests of the shareholders. We are modifying the proposal to include monthly payments to. A large cash premium at closing. “
JetBlue’s new offer will raise the reverse split fee from $ 350 million to $ 400 million and include a $ 2.50 per share dividend to Spirit’s shareholders if regulators do not approve the transaction.
It also includes a “tick fee” that pays shareholders 10 cents per share each month from January 2023 until the closing or closing of the transaction.
Frontier attacked a new JetBlue offer on Tuesday, dismissing JetBlue’s claim that the acquisition of Spirit would lead to lower airfares.
“JetBlue isn’t telling you the truth,” Frontier said in a statement. “JetBlue’s acquisition of Spirit leads to a deadlock, which means that the amount, rage, and turnover will not change, and the only value that JetBlue shareholders may receive from JetBlue’s proposal is JetBlue’s proposal. Lackes the realistic possibility of getting regulatory approval. “
JetBlue shares have given up their previous profits to fall 0.3% on Tuesday’s broader market plunge. Spirit’s share price rose more than 1% and Frontier rose 0.6% on Tuesday. Shares of these carriers plummeted on Monday.
Frontier Airlines on Friday increased the cash portion of the bid by $ 2 per share to $ 4.13 and raised the reverse split fee to $ 350 million in line with JetBlue’s previous offer.
“I think we have the most compelling proposal for shareholders,” Frontier CEO Barry Biffle said in an interview Monday. Biffle spoke from New York, who plans to meet with Spirit’s shareholders this week prior to Thursday’s vote.