JetBlue raises offer again in bidding for Spirit Airlines

By
|
Spirit's board has opposed a deal with JetBlue, saying antitrust regulators would never allow it.
Spirit's board has opposed a deal with JetBlue, saying antitrust regulators would never allow it. Photo Credit: Spirit Airlines

JetBlue has upped its bid once more for Spirit Airlines to $33.50 per share in cash, valued at $3.7 billion, surpassing its June 6 offer of $31.50 per share, and its initial April price of $33 per share, the company announced Monday.

The offer includes $32 per share at the closing of the deal and a prepayment of $1.50 per share in cash. 

Spirit initially had rejected the JetBlue offer in favor of its February merger agreement with Frontier for $2.9 billion, citing concerns the JetBlue deal would not meet regulatory approval because of a pending antitrust suit against JetBlue's "Northeast Alliance" with American Airlines.

JetBlue on Monday said it had made "additional regulatory commitments," however, it still was unwilling to abandon the Northeast Alliance.

In its June 20 proposal, JetBlue would commit to an "express obligation to litigate and to divest assets of JetBlue and Spirit up to a material adverse effect on the combined JetBlue-Spirit, with a limited carve-out to this divestiture obligation for actions that would be reasonably likely to materially and adversely affect the anticipated benefits under JetBlue's Northeast Alliance." 

The carrier also committed to a "proactive offer to the  Department of Justice of a remedy package that contemplates the divestiture of all Spirit assets located in New York and Boston so, as a result of this transaction, JetBlue will not increase its presence in the airports covered by our Northeast Alliance, as well as gates and related assets in Fort Lauderdale."

The new JetBlue proposal continues to offer a reverse break-up free of $350 million should the transaction not be completed for antitrust reasons.

Spirit had been scheduled to vote on its merger agreement on June 10, but postponed the special meeting until June 30.

JetBlue's most recent proposal was submitted at the request of Spirit's board of directors, and following completion of JetBlue's due diligence review and discussions with Spirit's management team, according to JetBlue.

Source: Business Travel News 

Comments

From Our Partners


From Our Partners

An Insider’s Look at the Globus family of brands and Avalon Waterways, featuring Camille Olivere
An Insider’s Look at the Globus family of brands and Avalon Waterways, featuring Camille Olivere
Watch Now
The Luxury Advisor
The Luxury Advisor
Read More
KLM Introduces Premium Comfort
KLM Introduces Premium Comfort
Watch Now

JDS Travel News JDS Viewpoints JDS Africa/MI