in

JetBlue will buy Spirit for $3.8 billion, making it the 5th largest airline in the U.S.

it will make JetBlue the fifth largest airline in the United States. The agreement on Thursday ended a bidding war that had been going on for months.

JetBlue Airways has agreed to buy Spirit Airlines for $3.8 billion. If the deal is approved by antitrust regulators, it will make JetBlue the fifth largest airline in the United States. The agreement on Thursday ended a bidding war that had been going on for months. It also came just one day after Spirit Airlines’ failed attempt to merge with another low-cost airline, Frontier Airlines.

Spirit CEO Ted Christie was put in the awkward position of defending a sale to JetBlue after arguing strongly against the deal and saying that antitrust regulators would never let it happen. Christie said on CNBC, “A lot has been said over the last few months, always with our stakeholders in mind.” “We’ve talked to the people at JetBlue, and they’ve got a lot of good ideas about how to do that.”

JetBlue will buy Spirit for $3.8 billion, making it the 5th largest airline in the U.S.
Photo by Joe Raedle/Getty Images)

JetBlue CEO Robin Hayes has always said that a bigger JetBlue would make American, United, Delta, and Southwest, the four airlines that control about 80% of the U.S. market, work harder. Spirit’s stock, which is based in Miramar, Florida, went up by 4% before Thursday’s opening bell, reaching $25.28. This is still less than what JetBlue is offering. Shares of JetBlue rose by about 1%.

JetBlue and Spirit will continue to run on their own until regulators and Spirit shareholders approve the deal. This means that they will have their own customer accounts and loyalty programs.

The companies said that they expect the regulatory process to be over and the deal to be done by the first half of 2024 at the latest. If that happens, Hayes would be in charge of the new airline, which would be based in New York, where JetBlue is from. It would have 458 planes in its fleet.

JetBlue said Thursday that it would buy Spirit for $33.50 per share in cash. This includes a prepayment of $2.50 per share in cash, which will be paid once Spirit stockholders agree to the deal. There is also a “ticking fee” of 10 cents per share every month starting in January 2023 until closing. This is to make up for any delays in getting regulatory approval for Spirit shareholders.

If the deal doesn’t go through because of antitrust rules, JetBlue will pay $70 million to Spirit as a reverse break-up fee and pay Spirit shareholders $400 million, less any money that was already paid to the shareholders.

Spirit and Frontier said in February that they wanted to merge, and Spirit’s board didn’t change its mind even when JetBlue made a better offer in April. Spirit’s board, on the other hand, could never get the airline’s shareholders to agree. The vote on the merger was put off four times, and it was cut short on Wednesday when Spirit and Frontier said they were ending their agreement. This meant that Spirit and JetBlue would have to join forces anyway.

Once the deal is done, JetBlue expects to save between $600 million and $700 million per year. Based on 2019 sales, the combined company is expected to make about $11.9 billion in revenue each year.

Travel News

Written by Barbarz Steelz

Leave a Reply

Your email address will not be published.

Troopers say a multi-vehicle crash on I-4 left a semi-truck driver with serious injuries.

Kate Moss says she felt “scared” during her photo shoot with Mark Wahlberg for Calvin Klein in 1992.