JetBlue Airways
JetBlue issued a proxy statement to Spirit shareholders urging them to vote no on the upcoming proposition to merge with fellow low-cost airline Frontier Group
"JetBlue offers more value - a significant premium in cash - more certainty, and more benefits for all stakeholders," CEO Robin Hayes wrote in the proxy letter. "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. Yet the Spirit Board failed to provide us the necessary diligence information it had provided Frontier and then summarily rejected our proposal, which addressed its regulatory concerns, without asking us even a single question about it."
JetBlue's initial offer to acquire Spirit followed a failed bid to purchase Virgin America, subsequently purchased by Alaska Airlines
While both Frontier and JetBlue stand to benefit from a merger with Spirit, only the former possesses overlap with the budget carrier's business model. Frontier would inevitably be more capable of adequately merging itself with Spirit, though JetBlue would still gain access to a much larger fleet of narrow-body aircraft, as well as a pool of pilots capable of flying them. Given that most airlines are left scrambling for pilots amid a labor crunch, JetBlue still stands to gain quite a bit from a potential acquisition despite its lack of overlap with Spirit.
JetBlue's share price slid 4.5% on Monday, though any anxiety investors had seemed to be mostly gone on Tuesday, with shares up 6.7% by noon. Spirit shares have been on a more steady climb, rising 4.6% on Monday and an additional 0.78% by noon on Tuesday.