JetBlue launches hostile takeover of Spirit after its earlier acquisition was rejected

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Source: The Verge

JetBlue launches hostile takeover of Spirit after its earlier acquisition was rejected

Spirit said the acquisition could raise antitrust issues

By Andrew J. Hawkins@andyjayhawk May 16, 2022, 11:34am EDT

JetBlue launched a hostile takeover of Spirit Airlines after its earlier acquisition offer was rejected. The New York-based airline said in a release that its tender offer for $30-per-share was “all-cash” and “fully financed.”

Earlier this month, Spirit’s board of directors rejected JetBlue’s $33-a-share bid to acquire the airline in favor of an existing merger agreement with Frontier, one of its ultra-low-cost competitors. The board cited antitrust issues and “an unacceptable level of closing risk” to its shareholders as its reasons for rejecting the JetBlue bid.

But JetBlue is still intent on acquiring Spirit, whether it wants to go ahead with the deal or not. The airline has said that absorbing Spirit would allow it to better compete with the “Big Four” carriers by increasing the size of its fleet and roster of trained pilots.

“JetBlue offers more value — a significant premium in cash — more certainty, and more benefits for all stakeholders,” JetBlue CEO Robin Hayes said in a statement. “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.”

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Read more: https://www.theverge.com/2022/5/16/23074907/jetblue-spirit-hostile-takeover-budget-airline-frontier