It seems JetBlue won’t take no as an answer in its attempts to acquire rival low-cost airline Spirit Airlines. After making improvement on its original offer in early June, JetBlue has sweetened it once again this week.
JetBlue initially saw its bid for Spirit snubbed in favor of the one made by Frontier Airlines. This prompted the Long Island City-based airline to make a largely improved bid that included $31.50 per share and a $350 million reverse break-up fee on June 6th. While this was enough for Spirit to reconsider its commitment to Frontier, it wasn’t enough to get the deal over the finishing line. This is why JetBlue now returned with what they call a “decisively superior proposal.”
The new terms include a price of $33.50 per share while keeping the reverse break-up fee of $350 million and prepayment of $1.50 per share in cash. Also, JetBlue would make an obligation to “divest assets” as part of the efforts to obtain regulatory approval. If the deal goes through, the merger of JetBlue and Spirit will create the fifth largest airline in the United States.
“Our previous proposal was met with an extremely positive reaction from Spirit stockholders, and we believe they will be even more pleased with these improved terms, including additional regulatory commitments that reflect our confidence in our ability to obtain antitrust approval and are a direct result of our diligence,” said JetBlue CEO Robin Hayes in a statement.
Frontier, on the other hand, is still sticking to its original proposal from February. Their bid includes a price of $25 per share and $250 million in reverse break-up fee. The Spirit shareholders were scheduled to vote on the offer on June 10th but moved it to June 30th after JetBlue swooped in.
