JetBlue Agrees To Purchase Spirit Airlines For $3.8 Billion After Months Of Negotiations (Update)

JetBlue Agrees To Purchase Spirit Airlines For $3.8 Billion After Months Of Negotiations (Update)

It looks like JetBlue may become the airline to purchase Spirit Airlines after all. If you remember, back in May Spirit declined JetBlue’s $3.6 billion buyout offer, as the company continued to pursue a deal with Frontier, but the tables have turned.

According to the Associated Press, after months of negotiations, it has been announced that JetBlue has agreed to buy Spirit Airlines for a total of $3.8 billion. If all goes through, and the purchase is approved by the antitrust regulators, the merge of the two airlines will make them the fifth largest airline in the U.S.

Spirit CEO Ted Christie spoke out about the news and said, “A lots been said over the last few months obviously, always with our stakeholders in mind. We have been listening to the folks at JetBlue, and they have a lot of good thoughts on their plans for that.”

The news of the two airlines merging together comes directly after Spirit Airlines’ deal with Frontier fell apart.

Robin Hayes, the CEO of JetBlue shared that he believes with the expansion of the company, that will create competition for the other leading airlines, which include American, Delta, United, and Southwest.

Both JetBlue and Spirit will continue to operate as two independent companies until the purchase is approved by regulators and Spirit shareholders. The regulatory process and close of transaction is expected to come to a closure no later than the first half of 2024. If the deal just so happens to not follow through, than JetBlue will “pay Spirit a reverse break-up fee of $70 million and pay Spirit shareholders $400 million.”

As previously reported, Spirit and Frontier announced their plans for their $6.6 billion merge back in February, as they awaited federal and shareholders approval. JetBlue followed up with a $3.6 billion buyout offer in May.

 

 

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TSR STAFF: Jade Ashley @Jade_Ashley94

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