JetBlue reached a deal to absorb Spirit Airlines for $3.8 billion Thursday, just one day after Frontier’s attempt to acquire the company fell through.
JetBlue’s takeover of the fast-growing budget airline, if approved by federal regulators, would elevate its status to being the fifth-largest airline in the nation, according to CNBC. Company executives reportedly stated that they hoped the acquisition of Spirit’s Airbus planes will help them compete with American, Delta, United, Southwest and other large airlines. (RELATED: Man Reportedly Kicked Off JetBlue Flight For Wearing ‘Let’s Go Brandon’ Mask)
JetBlue has reached a deal to buy Spirit Airlines after a months-long bidding war with Frontier. Why now? JetBlue CEO Robin Hayes and Spirit CEO Ted Christie join @Lebeaucarnews to discuss. https://t.co/d3uwWeiHTc pic.twitter.com/47MwP9Z09a
— CNBC (@CNBC) July 28, 2022
The proposed deal would see JetBlue paying for Spirit $33.50 per share in cash, USA Today noted. This would include a prepayment of $2.50 per share upon the transaction receiving shareholder approval and an additional 10 cents-a-month lagging fee from January 2023 through closing, according to the outlet.
The offer still needs to receive regulatory approval. JetBlue is allegedly already in hot water with President Joe Biden’s Justice Department over a coordination effort with American Airlines that the DOJ lawsuit referred to as a “de facto merger,” CNBC reported.
Spirit had previously urged shareholders to approve the recently-failed deal from Frontier, arguing the deal with JetBlue might be hard to pull off because of anti-trust regulators, USA Today reported.
JetBlue seems confident that the deal will be approved, stating that it hopes to receive legal approval by the fourth quarter of 2023 or in early 2024, according to CNBC.