FORT LAUDERDALE, Fla. — Spirit Airlines and Frontier Airlines agreed Wednesday to abandon their merger proposal, opening the way for JetBlue Airways to acquire Spirit.
Spirit, the largest budget carrier in the United States, said it was still in discussions with JetBlue “and expects to provide a further update in the near future.”
The decision by Spirit and Frontier to terminate their deal was announced while Spirit shareholders were still voting on the proposal. It was apparent that despite the support of Spirit's board, shareholders were prepared to reject the Frontier deal.
The Frontier offer was worth more than $2.6 billion in cash and stock, far short of JetBlue's all-cash bid of $3.7 billion.
A combination of Spirit with either Frontier or JetBlue would create the nation’s fifth-largest airline, although it would be still quite a bit smaller than American, United, Delta, and Southwest.
Once Spirit's fate is settled, analysts believe that more mergers are possible among the smaller airlines — but not likely any deals involving American, United, Delta, or Southwest, because of antitrust issues.
JetBlue and Alaska Airlines fought a bidding war over Virgin America in 2016, which Seattle-based Alaska won. Alaska's strength on the West Coast and JetBlue's network on the East Coast and the Caribbean have long made them the subject of merger speculation.
