JetBlue Makes Offer for Spirit Airlines

Spirit said its board planned to review the bid, which it described as “unsolicited,” and would “respond in due course.” After news of JetBlue’s offer broke on Tuesday, Frontier said in a statement that the acquisition would limit options and harm consumers.

Spirit’s shares jumped 22 percent on Tuesday, and Frontier’s rose 4 percent. JetBlue’s stock price fell 7 percent.

Either deal would be sure to face antitrust scrutiny from the Biden administration, which has taken a tough stance on mergers and partnerships. Last year, the Justice Department sued to prevent JetBlue from forming a domestic partnership, called the Northeast Alliance, with American Airlines, arguing that the agreement would drive up prices and reduce competition. The airlines rejected the premise of the still active lawsuit, contending that the partnership would increase competition against Delta Air Lines and United Airlines and in New York airports.

Mr. Hayes said he didn’t expect the Spirit deal to affect the lawsuit.

“We see them as very complementary,” he said, arguing that the acquisition of Spirit would build on the success of the alliance. “The NEA litigation is happening this year, whereas we expect the regulatory process for this transaction to take much longer.”

The proposed merger between Spirit and Frontier has also faced scrutiny. Last month, several progressive lawmakers, including Senators Elizabeth Warren, Democrat of Massachusetts, and Bernie Sanders, independent of Vermont, expressed misgivings, warning that the merger could raise ticket prices and harm customer service.

Article source: https://www.nytimes.com/2022/04/05/business/jetblue-spirit-frontier.html