Showing posts with label Spirit. Show all posts
Showing posts with label Spirit. Show all posts

09 April, 2024

Spirit Airlines to hold off on Airbus deliveries as cash becomes tight.....

Low-cost air carrier Spirit Airlines said yesterday morning that it will defer deliveries of new Airbus aircraft and furlough 260 pilots in the interest of saving cash - specifically, $340 million over the next two years, according to The New York Times.

All aircraft on order that are scheduled to be delivered in 2Q2025 through the end of 2026 will be deferred to 2030 - 2031, The Fly Report states

The furlough of 260 pilots starting September 1, 2024 comes as a result of the grounding of aircraft due to Pratt & Whitney GTF engine availability issues, along with the 2025 and 2026 aircraft deferrals, per Spirit’s press release.

As recently announced, Spirit entered into a compensation agreement Pratt & Whitney regarding its GTF engines, which is said to improve the budget carrier's by $150 million to $200 million over the term of that agreement. Additionally, Spirit will continue to evaluate the use of its current financeable asset base to add additional liquidity over the coming months, according to the press release.

"This amendment to our agreement with Airbus is an important part of Spirit's comprehensive plan to bolster profitability and strengthen our balance sheet," said Ted Christie, Spirit's President and Chief Executive Officer. "Deferring these aircraft gives us the opportunity to reset the business and focus on the core airline while we adjust to changes in the competitive environment. In addition, enhancing our liquidity provides us additional financial stability as we position the Company for a return to profitability. We would like to thank our partners at Airbus for their continued support and commitment to the long-term success of Spirit."

Spirit also defers by two years the dates for the optional aircraft included in Spirit's purchase agreement.  Apparently, there is no change to the total number of aircraft on order or Spirit options for additional aircraft, but this may change in later announcements. 

Some commentators have placed a time limit on Spirit's survival in its current state.  There is little doubt since the JetBlue takeover was halted by authorities the budget airline's future was precarious, to say the least. It had been looking around for another suitor that isn't as big as JetBlue, but has a large enough bank balance, yet the search has not proved fruitful.  Sun Country had been offered around as a good tie-up partner, but that isn't looking promising given the current market conditions. 
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04 March, 2024

JetBlue and Spirit give up on merger deal

JetBlue pulls out of Spirit Airlines takeover deal as it seeks to return to profitability.

The hometown airline of New York has decided to pull out of the takeover or merger as they preferred to call it, of the budget airline Spirit both carriers confirmed today. 

Pulling out of the deal is costing JetBlue a compensation payment of $69 million, in addition to the $480 million the company has already spent on the project which would have made a big impact on the American aviation industry. 

The two airlines have mutually agreed to terminate the $3.8bn deal as the required closing conditions, including receiving necessary legal and regulatory approvals, were unlikely to be met by the merger agreement’s outside date of July 24, 2024.Joanna Geraghty, chief executive officer of JetBlue said:  “We believed this merger was worth pursuing because it would have unleashed a national low-fare, high-value competitor to the Big Four airlines. We are proud of the work we did with Spirit to lay out a vision to challenge the status quo, but given the hurdles to closing that remain, we decided together that both airlines’ interests are better served by moving forward independently. We wish the very best going forward to the entire Spirit team.”

Following the deal being blocked by a US judge in January on anti-competition concerns, there seemed no way forward for the deal. In a recent shareholders call, the focus for JetBlue was to return to sustained profitability, drive up shareholder value and concentrate on its core strengths.  Geraghty added “We have already begun to advance our plan to restore profitability. We look forward to sharing more on our progress in the coming months.”  The airline plans to cement its network relevance in its home markets as well as enhance its products and services.  

Ted Christie, Spirit's President and Chief Executive Officer said: "After discussing our options with our advisors and JetBlue, we concluded that current regulatory obstacles will not permit us to close this transaction in a timely fashion under the merger agreement," 

"We are disappointed we cannot move forward with a deal that would save hundreds of millions for consumers and create a real challenger to the dominant "Big 4" U.S. airlines. However, we remain confident in our future as a successful independent airline. We wish the JetBlue team well."  

05 February, 2024

Another new Airbus jet for Spirit.

Spirit Airlines has taken delivery of one new Airbus A321neo aircraft on long-term lease basis from Aviation Capital Group LLC (ACG), a premier global full-service aircraft asset manager.  The new jet is powered by ultra-efficient Pratt & Whitney GTF engines and is the fourth of four aircraft ordered from ACG and taken from their existing orderbook with planemaker Airbus.

ACG is one of the globe's leading aircraft leasing firms, with over 490 owned, managed and committed aircraft as of September 30, 2023, leased to roughly 90 airlines in approximately 45 countries.

The budget carrier recently celebrated twenty years of flying between the U.S. and Mexico, with its routes to  Cancun International Airport.  "For 20 years, we've been pleased to offer our Guests affordable, nonstop service to Cancun, making the popular beach destination more accessible and affordable with the opportunity to save on airfare while enjoying more of Cancun's tourist attractions," said John Kirby, Vice President of Network Planning at Spirit Airlines. "We're grateful to Cancun International Airport and our Guests in Southeast Mexico for embracing our business model and trusting us with their travels for the past two decades."

Spirit currently offers nonstop service from Cancun to nine cities in the United States: Baltimore (BWI), Chicago (ORD), Dallas (DFW), Detroit (DTW), Fort Lauderdale (FLL), Houston (IAH), Orlando (MCO), New Orleans (MSY) and Philadelphia (PHL). 

11 September, 2023

JetBlue and Allegiant Announce Divestiture Agreement in Connection with JetBlue’s Combination with Spirit

Divestitures Help Promote the Continued Growth of Ultra-Low-Cost Options at Boston Logan, Newark Liberty International, and Fort Lauderdale-Hollywood Airports.

JetBlue Airways Corporation and Allegiant today announced that the airlines have entered into a definitive agreement under which JetBlue will transfer to Allegiant all of the holdings of Spirit Airlines, Inc. at Boston Logan International Airport and Newark Liberty International Airport. JetBlue will also turn over up to five gates and related ground facilities at Fort Lauderdale-Hollywood International Airport to promote ultra-low-cost carrier growth.

On June 1, JetBlue announced that it will divest all of Spirit’s holdings at New York’s LaGuardia Airport to Frontier. Together, these divestitures are part of JetBlue’s voluntary upfront commitments included in the merger agreement with Spirit and are conditioned on the closing of the JetBlue-Spirit transaction.

The divestitures are subject to approval by the local airport authorities as well as FAA/DOT, and are conditioned upon and will occur after the closing of JetBlue’s planned combination with Spirit. JetBlue expects to close the transaction with Spirit in the first half of 2024.

“Over the past twenty years, JetBlue has established itself as a competition MVP, bringing high-quality, affordable service to a wide variety of travellers across the United States,” said Robin Hayes, chief executive officer of JetBlue. “Merging with Spirit will allow us to bring our signature service and low fares to even more people and places across the country and beyond. Our divestiture commitment, while not needed to ensure the continued growth of the vibrant ultra-low-cost carrier segment, is aimed at removing any doubt of our commitment to promoting competition.”

“We are committed to long-term growth, especially in areas such as New York, Boston and Florida. This agreement will allow us to expand our service in these cities and ensure that customers have even more access to affordable, nonstop flights for their travel needs,” said Drew Wells, chief revenue officer, of Allegiant.

Under the terms of the agreement, JetBlue has agreed to transfer to Allegiant all of Spirit’s holdings in Boston and Newark, principally consisting of two gates in Boston, two gates in Newark, and 43 takeoff and landing authorizations in Newark. In addition, JetBlue has agreed to relinquish up to five gates at Fort Lauderdale to the Broward County Aviation Department and will work closely with the Department to facilitate Allegiant’s ULCC growth at FLL using these gates.

02 June, 2023

JetBlue to hand over Spirit's holdings at LaGuardia Airport to Frontier

JetBlue Airways will hand over all of Spirit Airlines operations at  New York’s LaGuardia Airport to Frontier Airlines the New York hometown carrier advised this week.  These divestitures are part of JetBlue’s upfront commitments included in the merger agreement with Spirit and are conditioned on the closing of the JetBlue-Spirit transaction.

Under the terms of the agreement, JetBlue has agreed to transfer to Frontier all of Spirit’s holdings at LaGuardia, principally consisting of six gates at the Marine Air Terminal and 22 takeoff and landing slots. 

“We are committed to ensuring our combination with Spirit preserves ultra-low-cost carrier access in New York,” said Robin Hayes, chief executive officer, JetBlue. “We are pleased that this agreement with Frontier will maintain the same level of ultra-low-cost carrier service at LaGuardia Airport.”

“We’re pleased to have reached this agreement to acquire Spirit’s slot pairs and leasehold interests at New York’s LaGuardia Airport, pending regulatory approval of the JetBlue-Spirit merger,” said Barry Biffle, President and CEO, Frontier Airlines. “It will enable us to significantly expand our operations at LaGuardia and deliver even more ‘Low Fares Done Right’ to consumers in the greater New York City area.”

21 April, 2023

One new Airbus A320neo aircraft delivered to Spirit Airlines.

Aviation Capital Group LLC (“ACG”) announced the delivery of one new Airbus A320neo aircraft on long-term lease to Spirit Airlines. Powered by the ultra-efficient Pratt & Whitney GTF engines, this is the second of four aircraft scheduled to deliver to the airline from ACG’s order book with Airbus.

Aviation Capital Group was founded in 1989 and is one of the world’s premier full-service aircraft asset managers with approximately 470 owned, managed and committed aircraft as of December 31, 2022, which are leased to approximately 95 airlines in approximately 45 countries. ACG is a wholly owned subsidiary of Tokyo Century Corporation.

25 March, 2023

Aviation Capital Group announces delivery of an Airbus A320neo to Spirit Airlines

Aviation Capital Group ACG has confirmed the delivery of one new Airbus A320neo aircraft on long-term lease to Spirit Airlines. Powered by the ultra-efficient Pratt & Whitney GTF engines, this is the first of four aircraft scheduled to deliver to the airline from ACG’s order book with Airbus. This is ACG’s first aircraft delivery from Airbus’ facility in Mobile, Alabama.

“We are thrilled to be delivering our first new Airbus A320neo aircraft to Spirit Airlines, which also marks ACG’s first aircraft delivery from Mobile, Alabama,” said Alan Mangels, Vice President of Marketing for ACG.  “We are also proud to partner with Spirit Airlines in working towards a cleaner and more sustainable future by investing in fuel-efficient, new technology aircraft that produce lower emissions, use less fuel and create less environmental noise.”

Aviation Capital Group was founded in 1989 and is one of the world’s premier full-service aircraft asset managers with approximately 470 owned, managed and committed aircraft as of December 31, 2022, which are leased to approximately 95 airlines in approximately 45 countries. ACG is a wholly owned subsidiary of Tokyo Century Corporation.

07 March, 2023

JetBlue and Spirit have little overlap and its merger will increase competition.......airline says.

JetBlue released updated data, which further supports the disruptive role of the airline on the dominant, higher-price legacy carriers, and the pro-competitive impact the merger with Spirit will have on the industry.

Analysis Adds to Compelling Rationale for JetBlue-Spirit Combination

JetBlue is over 3x more effective than Spirit at bringing down competitor fares. JetBlue’s unique combination of low fares and great service is a competitive force that keeps the legacy carriers on their toes and results in lower fares. This is the “JetBlue Effect,” an outcome specifically cited by the U.S. Department of Justice. An economic analysis found that JetBlue is proven on average to be over 3x as effective at lowering legacy carrier nonstop fares than Spirit. With the scale unlocked by combining with Spirit, JetBlue will be able to bring down legacy carrier fares on more routes, benefitting more travelers than if JetBlue and Spirit continued as standalone airlines.
JetBlue and Spirit primarily compete with other carriers not each other. According to a third-party source published in April 2022 and reaffirmed with more recent data, JetBlue and Spirit have very limited overlap, and only overlap on 11% or less of the nonstop routes on which both of them fly. Instead, both carriers primarily compete against the dominant Big Four airlines.

25 February, 2023

JetBlue Celebrates Groundbreaking of JFK’s New Terminal 6

New York City-based JetBlue joined by New York Governor Kathy Hochul and other partners and leaders, celebrated a key milestone in the Port Authority of New York and New Jersey's transformation of John F. Kennedy International Airport (JFK) with the groundbreaking of a $4.2 billion project to develop a new international Terminal 6. The groundbreaking, held Thursday at JetBlue’s JFK maintenance hangar, only reinforces the airline’s commitment to JFK, Queens, and New York.

The new Terminal 6 will connect seamlessly with JetBlue’s current home at Terminal 5, adding gates and opportunity for the airline to add flights, destinations and partner airline connections. The project is a public-private partnership between the Port Authority of New York and New Jersey and JFK Millennium Partners - a consortium that includes JetBlue, Vantage Airport Group, an industry leading investor, developer, and manager of award-winning global airport projects, including LaGuardia Terminal B; American Triple I, a certified minority-owned investor, owner, developer, and manager of infrastructure assets; and New York real estate operating company RXR.

“It was 23 years ago that JetBlue launched our first flights from our home at JFK, eventually growing and taking over our modern Terminal 5 and now sending customers to more than 80 destinations, including London and soon Paris. At a time that JetBlue is set to grow significantly, we are excited to once again invest and further the governor’s vision as we build the new Terminal 6,” said Robin Hayes, chief executive officer, JetBlue. “As we move JFK into the future with a new, state-of-the-art, customer-focused facility, we are so pleased to have an opportunity to expand our presence with new gates in a new terminal. The team putting this project together is setting out to develop a terminal that New Yorkers, including our JetBlue crewmembers, can be proud of.”

With hiring ongoing throughout the company, more than 7,000 JetBlue crewmembers are now based at JFK.

Continued Growth with Spirit Airlines

26 August, 2022

Spirit Airlines resumes flights between South Florida and Managua, Nicaragua

The U.S. low-cost carrier and soon to be part of JetBlue, Spirit Airlines has confirmed the resumption of its daily, nonstop service connecting Managua (MGA) and Fort Lauderdale (FLL) from the end of November.

Spirit's return to the market will play a pivotal role in offering both convenience and affordability for family and friends to reconnect with one another, and the service provides opportunities to explore Nicaragua's historic sites, vibrant culture and natural beauty.  

"We're eager to welcome back our Nicaraguan Guests and excited to make travel to and from Managua accessible for families, friends, and visitors again," said Camilo Martelo, Director of International Stations. "We have a 15-year history serving Nicaragua and are proud to give South Florida and Managua back the affordable fares and signature service they've come to know when travelling between our countries."

The daily, nonstop service to FLL starts November 30 and offers connections to 26 cities across Spirit's network.

Spirit Airlines Connection Options to/from MGA:  

Aguadilla (BQN)

Cleveland (CLE)

Louisville (SDF)

San Juan (SJU)

Atlanta (ATL)

Dallas (DFW)

Myrtle Beach (MYR)

St Thomas (STT)

Atlantic City (ACY)

Detroit (DTW)

Nashville (BNA)

St. Louis (STL)

Baltimore (BWI)

Houston (IAH)

Newark (EWR)

Tampa (TPA)

Boston (BOS)

Indianapolis (IND)

Orlando (MCO)

Charlotte (CLT)

LaGuardia (LGA)

Philadelphia (PHL)

Chicago (ORD)

Latrobe (LBE)

Richmond (RIC)

   The resumption of Managua service increases the airline's international service to 29 markets across Latin America and the Caribbean, including neighbouring Central American destinations in Costa Rica, El Salvador, Honduras, Guatemala, and Panama.

An all-new cabin interior with ergonomically-designed seats and more usable legroom, featuring the best deal in the sky with our unique Big Front Seat.

28 July, 2022

JetBlue goes ahead with its take over of Spirit after Frontier drops out.......

Frontier Airlines has dropped out of the battle for low-cost airline Spirit, leaving New York's hometown airline, JetBlue, the default winner and the boards have agreed to the takeover.

JetBlue is paying a high price for Spirit in this deal, $33.50 per share in cash, including a prepayment of $2.50 per share in cash payable upon Spirit stockholders’ approval of the transaction and a ticking fee of $0.10 per month starting in January 2023 through closing, for an aggregate fully diluted equity value of $3.8 billion1 and an adjusted enterprise value of $7.6 billion, more than double Spirits value.

Robin Hayes, the chief executive officer of JetBlue whose future at the airline had been in doubt had the deal not gone ahead, said today: “We are excited to deliver this compelling combination that turbocharges our strategic growth, enabling JetBlue to bring our unique blend of low fares and exceptional service to more customers, on more routes. We look forward to welcoming Spirit’s outstanding Team Members to JetBlue and together creating a customer-centric, fifth-largest carrier in the United States. Spirit and JetBlue will continue to advance our shared goal of disrupting the industry to bring down fares from the Big Four airlines. This combination is an exciting opportunity to diversify and expand our network, add jobs and new possibilities for Crewmembers, and expand our platform for profitable growth.”

“Combining with Spirit will give JetBlue an even larger platform to deliver on our mission to inspire humanity,” said Peter Boneparth, chair of the board, JetBlue. 

Ted Christie, president and chief executive officer, Spirit, said, “We are thrilled to unite with JetBlue through our improved agreement to create the most compelling national low-fare challenger to the dominant U.S. carriers, and we look forward to working with JetBlue to complete the transaction. Bringing our two airlines together will be a game changer, and we are confident that JetBlue will deliver opportunities for our Guests and Team Members with JetBlue’s unique blend of low fares and award-winning service. We especially appreciate the commitment of our Spirit Family throughout this process. Today’s exciting announcement reflects JetBlue’s admiration for Spirit and a shared belief in what the combined airline can bring for our Guests.”

28 June, 2022

JetBlue ups its offer for Spirt........maybe the 43rd time will work.....

JetBlue ups bid for Spirit….

There is no doubt that JetBlue’s management have set their hearts on getting the most complained about airline in the U.S. as it battles against Frontier. The New York-based airline has upped its bid yet again – seems like this is the 43rd increase in either amount or conditions associated with the take-over deal they’ve done since they first discussed the buyout over a year ago.

There is also no doubt that the JetBlue offer has drastically over-valued Spirit that will cause the firm huge long term issues if they are successful – the axing transatlantic services is on the cards for next year should the deal go ahead cited one staffer at The Brewster.

•          The main changes to the new offer are Increased accelerated prepayment to $2.50 per share, structured as a cash dividend to Spirit shareholders promptly following the Spirit shareholder vote approving the combination between Spirit and JetBlue (subject to CARES Act limitations).

•          Enhanced reverse break-up feeof $400 million payable to Spirit in the unlikely event the transaction is not consummated for antitrust reasons.

•          Addition of a ticking fee mechanism, which would provide shareholders with a monthly prepayment of $0.10 per share between January 2023 and the consummation or termination of the transaction. This represents an estimated aggregate ticking fee of up to $1.80 per share, of which the first $1.15 per share in payments will offset the reverse break-up fee or the merger consideration. Any payments in excess of the $1.15 per share will be incremental to the total purchase price of $33.50 or the reverse break-up fee. This increases the total transaction consideration to up to $34.15 per share in the event the transaction is consummated and total downside protection to $4.30 per share, or approximately $470 million in the aggregate, in the event the transaction is terminated.

“After the Spirit Board’s failure to recognize our decisively superior offer, we’ve discussed our offer directly with Spirit shareholders and are now modifying our proposal in response to shareholders’ expressed interest, to include a monthly payment for shareholders, with the certainty of a significant cash premium at closing,” said Robin Hayes, chief executive officer, JetBlue.

It has been reported locally that JetBlue staff in Fort Lauderdale are unhappy with possible future working patterns that could seem them working seven days in a row if the takeover of Spirt occurs and are consulting with Union representatives, although we’ve not been able to independently verify this. However, if true it would only be the very start of such conversations and negotiations if a deal is completed according to some staff members of JetBlue.

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25 June, 2022

JetBlue issues yet another statement in its bitter battle to take over Spirit.....

The once great and highly respected New York-based JetBlue has issued yet another public statement on the state of its failing take-over plan for America's most complained about budget operation - Spirit.

The board of JetBlue seem so utterly convinced that buying Spirit will boost their business so much they are completely blinkered by the damage they are doing to their reputation by the constant bickering in public. The financial damage just keeps on going with the repeated increases in prices JetBlue offers for Spirit means they are now willing to pay nearly double what Spirit is worth and almost every analyst we've approached thinks this is a bad deal - not for Spirit, but for JetBlue. "Unless there is something very drastic hidden in the private disclosure documents, the current deal is like mana from heaven for Spirits shareholders, for JetBlue..well if it goes through it could bring the company crashing down." one business analyst from Barclays told us. 

JetBlue says "We continue to believe JetBlue’s proposal is decisively superior to the Frontier transaction, even considering its revised terms, and it continues to offer Spirit shareholders significantly more value, more cash, more certainty, and more regulatory protections. JetBlue offers $33.50 per Spirit share in cash, a very significant 38%1 premium to the implied market value of the amended Frontier transaction. Also, importantly the incremental $2.00 per Spirit share offered by Frontier are effectively being paid by Spirit shareholders through their ownership in the combined company, therefore resulting in only approximately $1 of incremental economic value."

They continue, in a bitter attack on Spirit's board, which is likely to anger and inflame tensions, not with those high up, but those in middle management and the vast majority of workers at the Spirit -  the very staff JetBlue would need to turn the firm around. "The conflicted Spirit Board continues to rely on a series of mischaracterizations to justify an inferior deal – about the regulatory situation, that is at odds with the views of outside experts that our transaction can get done; about the Northeast Alliance, despite the overwhelming facts supporting its pro-competitive nature; and about the impact of the changing industry environment, including competition for pilots. Adding to these misrepresentations, the Spirit Board is now claiming they have served their shareholders by accepting a revised Frontier proposal, an act which does not change the fundamental superiority of our transaction, agreeing, among other things, in exchange for underwhelming financial concessions, to weaken Spirit shareholders’ governance in the combined company through less board representation." JetBlue's statement concludes.

JetBlue should have walked away months ago, Spirit was a good target for a takeover, at a reasonable price, and now JetBlue is offering to pay for a brand new Ferrari but getting a second-hand Chevrolet Spark, with a flat tyre.  It doesn't make sense unless this is a proxy war, Delta quietly pulling the strings behind Frontier and Spirit and American Airlines behind JetBlue? 

Yet either way, it is damaging the JetBlue brand, a group of seven UK-based travel arrangement companies have moved away from offering JetBlue's transatlantic services for their New York and New England holidays. "We'll only sell JetBlue if a customer specifically asks for them now, we've moved most of our customers to British Airways or United for Boston." a senior manager told us on Friday.

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14 June, 2022

Spirit talking with JetBlue after revised offer.

Spirit has confirmed it has allowed JetBlue access to due diligence information that has already been shared with the rival bidder for the low-cost carrier, Frontier as the battle heats up for the take over.

Spirit confirm the JetBlue talks were ongoing following the New York-based airline’s revised and upgraded offer.  JetBlue’s senior management are optimistic Spirit will eventually choose them as the preferred buyer, its Chief Executive Robin Hayes said last week, "We're pleased that there now seems to be a genuine desire from the Spirit board to engage with us. -We're going to continue to engage with the Spirit board over the next few weeks."

Air101: Yet another offer from JetBlue in the battle for Spirit

Air101: JetBlue appeals to Spirit staff.....

06 June, 2022

Yet another offer from JetBlue in the battle for Spirit

New York's JetBlue has just submitted yet another improved proposal to the Board of Directors of Spirit to acquire all of the outstanding common stock of Spirit. The new offer offers Spirit stockholders demonstrably superior value, more regulatory protections, and the prepayment of a portion of cash consideration:

Enhanced reverse break-up fee: JetBlue would provide a $350 million ($3.20 per Spirit share1) reverse break-up fee, payable to Spirit in the unlikely event the transaction is not consummated for antitrust reasons. This represents an increase of $150 million, or $1.37 per Spirit share, to the reverse break-up fee JetBlue has previously offered to pay, and is $100 million greater than the amount being offer by Frontier.
Accelerated prepayment of $1.50 per share: JetBlue would prepay $1.50 per share in cash (approximately $164 million) of the reverse break-up fee, structured as a cash dividend to Spirit stockholders promptly following the Spirit stockholder vote approving the combination between Spirit and JetBlue.2
Superior, all-cash premium: JetBlue’s proposal offers Spirit stockholders aggregate consideration of $31.50 per share in cash, comprised of $30 per share in cash at the closing of the transaction and the prepayment of $1.50 per share of the reverse break-up fee.
JetBlue has sent a letter to the Board of Directors of Spirit containing its improved proposal. In the letter, JetBlue CEO Robin Hayes states:

“Combining JetBlue and Spirit would create a true national competitor to the dominant legacy carriers, delivering low fares and a great experience for more customers, more opportunities and good-paying jobs for crew members, and more value for stockholders. The key features of our Improved Proposal – the up-front cash payment and increased reverse break-up fee – reflect the seriousness of our commitment and underscore our confidence in completing this transaction. Additionally, given the similar regulatory risks of the two transactions and the increased reverse break-up fee we are prepared to provide, we believe our Improved Proposal remains a Superior Proposal by any measure.”

03 June, 2022

More negotiations and backroom bickering on the battle to take over Spirit.

The negotiation and bickering continue at a pace in the battle to take over Spirit Airlines, following the news that the Frontier Group Holdings has amended its offer for the ailing budget carrier. 

Just added is a condition that Frontier would pay a reverse termination fee of $250 million, or $2.23 per share, to Spirit in the unlikely event the combination is not consummated for antitrust reasons.

William A. Franke, the Chair of Frontier's Board of Directors and the managing partner of Indigo Partners, Frontier's majority shareholder, said, "We continue to believe in the strategic rationale of a combined Spirit and Frontier, which brings together two complementary businesses to create America's most competitive ultra-low fare airline. Given our conviction that regulators will find this combination to be pro-competitive, we have agreed to institute a reverse termination fee. We look forward to bringing these two companies together and delivering on the benefits for all stakeholders."

Ted Christie, President and CEO of Spirit, said, "Since announcing our transaction with Frontier, we have had extensive constructive conversations with our stockholders, who have expressed support for the strategic rationale of our combination but a desire for additional stockholder protections. After discussing this feedback with the Frontier Board and management team, we have agreed to amend the merger agreement. We look forward to closing the transaction and bringing more ultra-low fares to more people in more places."

Spirit has employed a firm more used to lobbying politicians to lobby shareholders to accept the Frontier deal, rather than the rival and way more lucrative offer from the New York hometown airline JetBlue. 

JetBlue issued a statement in which it blamed conflict amoung members of Spirit's board for the way they continue to prompote a deal against the best interests of shareholders. "yet again, they have failed to do. Spirit’s Board only went back to Frontier under pressure, when it became increasingly clear their shareholders would decisively reject the Spirit Board’s flawed process and Frontier’s inferior transaction.

The addition of a reverse termination fee in the face of a likely defeat is simply an acknowledgement that the regulatory profiles and timelines of both deals are indeed similar. Spirit had already admitted that its own prior unreasonably optimistic projections of receiving approval this year were in fact not accurate. Experts agree both transactions will receive the same level of scrutiny.

JetBlue will review and assess the revised terms of the amended merger agreement once it has been made available. We believe we have put forward a clearly superior offer and remain prepared to negotiate in good faith a consensual transaction at $33, subject to receiving necessary diligence. We urge Spirit shareholders to continue to let the Spirit Board know they want an open, fair process, providing us a level playing field and full access to the same information available to Frontier. There is still time for the Spirit Board to do the right thing for their shareholders."

As this take-over battle continues the reputation of all three firms is taking a knocking, many of JetBlue's own management are against the propsotion to take over Spirit. A top level leader in another of Indigo Partners airlines has said the Frontier / Spirit merger will not survive regulatiory investigation and has already put a strain on future development for the rest of the group.  

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31 May, 2022

Leading Independent Proxy Advisory Firm ISS Recommends Spirit Shareholders ‘Vote No’ on Frontier Transaction

JetBlue today announced that Institutional Shareholder Services (“ISS”), the leading independent proxy advisory firm, has issued a report recommending that Spirit shareholders vote AGAINST the inferior, high-risk, and low-value Frontier transaction at Spirit’s upcoming special meeting.

“We are pleased that ISS recognized that our proposal offers Spirit shareholders superior value and has a clear path to completion,” said Robin Hayes, chief executive officer, JetBlue. “The ISS report highlights the flawed process that the conflicted Spirit Board followed, which only underscores the need for Spirit’s Board to now come to the table and negotiate – this time in good faith – with JetBlue. Spirit shareholders can send that strong message to their Board by voting against the Frontier transaction and against adjournment.

“ISS highlighted that a deal with JetBlue will bring more value and cash certainty. We believe it is clear a combined JetBlue-Spirit will bring more competition with the Big Four airlines driven by the power of the JetBlue Effect, supporting our conviction that we can achieve regulatory approval for our transaction,” Hayes said.

JetBlue Offers Superior Value to Spirit Shareholders

ISS recognized that JetBlue’s current proposal, backed by years of financial and regulatory analysis in consultation with external advisors, offers full and certain value to Spirit shareholders at a substantial premium to the Frontier transaction – the value of which has only decreased since it was first announced.

The ISS report highlighted: “The offer from JetBlue is superior from a financial standpoint, with a cash consideration at a meaningfully higher premium than the mostly stock deal from Frontier … On balance, a potential agreement with JetBlue would appear to offer shareholders superior optionality, allowing those concerned with the turbulence ahead to exit at a significant premium, while allowing those with a more optimistic outlook to reinvest the premium consideration.”

Spirit’s Conflicted Board Is Not Serving the Best Interests of Its Shareholders

ISS’s conclusions on the sales process run by the Spirit Board also aligned with JetBlue’s contention that Spirit’s directors appear to be more aligned with the interests of Frontier and Bill Franke’s Indigo Partners than those of Spirit shareholders – as demonstrated by their misrepresentations regarding their engagement with JetBlue, and their desire to defend the inferior Frontier transaction at any cost. Spirit’s CEO has even admitted that if the Frontier transaction is voted down by its own shareholders, it will continue as a standalone company rather than pursuing a value-maximizing opportunity with JetBlue.

The ISS report noted: “The board's decision to forgo an auction process is a cause for concern, since investors lack market-based evidence that the deal presented in fact represents the best available alternative, as evidenced by the competing offer from JetBlue … In addition to the lack of a competitive process, shareholders may question the board's failure to negotiate a reverse termination fee with Frontier in light of the potential regulatory risk and JetBlue's offer of a $200 million termination fee (in a negotiated transaction).”

Confidence in Potential for Regulatory Approval and Recognition of Stronger Contractual Commitments

ISS noted that while its analysis did not determine regulators’ preference between the JetBlue-Spirit or Frontier-Spirit combinations, it concluded that “there appears to be no conclusive evidence that JetBlue’s proposal has zero chance of approval,” as the conflicted Spirit Board has falsely asserted.

The ISS report noted: “the [Spirit] board’s view that a Frontier merger has a safer path to regulatory approval is not supported by any guarantee of value for shareholders in the event of regulatory rejection. Spirit’s view that the Frontier proposal may have a smoother glide path towards achieving regulatory approval appears reasonable, but its assertion that the JetBlue proposal has zero chance of approval appears far less so.”

JetBlue Urges Spirit Shareholders to Vote AGAINST the Frontier Transaction

Spirit shareholders are encouraged to read more about JetBlue’s proposal, and the Spirit Board’s attempt to defend the inferior Frontier transaction, at JetBlue urges Spirit shareholders to vote AGAINST the Frontier transaction on the BLUE proxy card, vote AGAINST adjournment of the special meeting, and tender their shares into JetBlue’s cash tender offer.

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19 May, 2022

Spirit's board still against JetBlue take over deal

The board of the budget airline Spirit has yet again rejected the advances of JetBlue,  in favour of a takeover bid from Frontier.  The low-cost airline's bosses are still claiming that the JetBlue deal would face substantial regulatory hurdles, especially while the Northeast Alliance NEA with American Airlines remains in effect. The U.S. Department of Justice (DOJ) is currently suing JetBlue and American Airlines, alleging that the NEA is anti-competitive. Spirit is opposed to the NEA on grounds that it is anti-competitive,  Spirit does not believe the DOJ, or a court, will be persuaded that JetBlue should be allowed to form an anticompetitive alliance that aligns its interests with a legacy carrier (American) and then undertake an acquisition that will eliminate the largest ULCC carrier in the U.S. (Spirit).

In response, JetBlue issued the following statement  'It’s no surprise that Spirit shareholders are getting more of the same from the Spirit Board. The Spirit Board, driven by serious conflicts of interest, continues to ignore the best interests of its shareholders by distorting the facts to distract from their flawed process and protect their inferior deal with Frontier.

Regarding regulatory approval, Spirit would have you ignore the current regulatory climate to think that approval of their Frontier deal is assured. That is simply not true. Both deals are subject to regulatory review, and both deals have a similar risk profile. Spirit shareholders recognize that and are showing great interest in hearing more about our superior offer and the regulatory commitments and protections we have made, including a reverse break-up fee.

Frontier offers less value, more risk, and no regulatory commitments, despite a similar regulatory profile. We are confident that as we continue to share the facts directly with Spirit shareholders, they will be even more perplexed than they already are about why the conflicted Spirit Board has refused to negotiate with us in good faith. We believe that the Spirit shareholders will make their views known by voting against the Frontier offer and tendering their shares into our offer.'

Which way Spirit's shareholders will go remains to be seen, however, if nothing happens and Spirit is left to flounder, it will be toast before the end of this year. The company has more debts than it can realistically cope with, it is running at a loss and some of its legal fees are being picked up by another airline entity. Its management has been making calls with the senior leadership of another mega-carrier and has effectively not been completely honest with shareholders, as the merger or takeover by Frontier would also face anti-competition opposition and investigation from authorities.  
From the outside, it would seem like Spirit's board is acting against the company's and shareholders' interests, one might even say there is a whiff of dishonesty in the air, oh how that aroma of corruption seems to linger. However,  that's not to say the JetBlue deal would present problems, even if it did go through.  It would be an uphill battle for the New York based airline to win the hearts and minds of Spirit employees that have been poisoned against JetBlue and everything it stands for.  The reputation of JetBlue hangs in the balance either way, which is something that costs millions and takes decades to achieve, but only moments to lose. 


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16 May, 2022

JetBlue Urges Spirit Shareholders to Protect Their Interests and ‘Vote No’ on Frontier Transaction

JetBlue has spent a special message to Spirit shareholders asking them to “Vote No” to an inferior deal from Frontier.

JetBlue commenced an all-cash, fully financed tender offer to acquire all of the outstanding shares of Spirit for $30 per share, without interest and less any required withholding taxes. Given the Spirit Board of Directors’ complete unwillingness to share the same necessary diligence information that was shared with Frontier, JetBlue is now offering to acquire Spirit for $30 per share in cash through a fully financed tender offer. This represents a 60% premium to the value of the Frontier transaction as of May 13, 2022 – a very compelling offer and higher than the premium implied by JetBlue’s original proposal. JetBlue is fully prepared to negotiate in good faith a consensual transaction at $33, subject to receiving necessary diligence.

JetBlue launched a website at and issued a letter to Spirit shareholders detailing the benefits of its transaction, the certainty of closing, and the misleading statements made by Spirit. In the letter, JetBlue CEO Robin Hayes states:

“JetBlue offers more value – a significant premium in cash – more certainty, and more benefits for all stakeholders. Frontier offers less value, more risk, no divestiture commitments, and no reverse break-up fee, despite more overlap on non-stop routes and their own regulatory challenges."

“Yet the Spirit Board failed to provide us the necessary diligence information it had provided Frontier and then summarily rejected our proposal, which addressed its regulatory concerns, without asking us even a single question about it. The Spirit Board based its rejection on unsupportable claims that are easily refuted."

“Ask yourself a simple question: why won’t the Spirit Board engage with us constructively? The interests of Bill Franke’s Indigo Partners and the long-standing relationships between the two companies is the obvious answer.”

The letter goes on to note that JetBlue’s current proposal still offers more value and certainty for Spirit shareholders than Frontier, and stresses that the company is prepared to engage on the basis of its original proposal, if the Spirit Board acts in good faith:

“Based on the clear superiority of our offer, we expected the Spirit Board to engage constructively. Given its unwillingness to share necessary information or negotiate in good faith, we adjusted our price accordingly, but will work towards a consensual transaction at $33 per share, subject to receiving the information to support it.”