Latest News by Industry
• Frontier has increased reverse termination fee to $350 million
• JetBlue said its ‘proposal is decisively superior to the Frontier transaction’
Spirit Airlines Inc (NYSE: SAVE) on Friday said it has renewed its support for Frontier Group Holdings (NASDAQ: ULCC) after the latter raised its cash offer by $2 per share to buy the rival ultra-low-cost airline.
On Monday, JetBlue Airways (NASDAQ: JBLU) sweetened its takeover offer for Spirit to $33.50 per share - up to $2 - to convince Spirit’s board to agree to its deal.
At Frontier’s closing price on Friday, its offer is worth $24.29 in stock and cash.
Spirit shareholders will be voting on the Frontier takeover proposal on June 30.
Frontier stock jumped 6.6% on Friday to close at $10.54, while Spirit rose 2.9% to $24.52. JetBlue shares gained 5.8% to close at $8.62.
Spirit’s board said it “reiterates its unanimous recommendation that Spirit stockholders vote” in favor of the merger with Frontier based on the improved offer.
“We continue to believe JetBlue’s proposal is decisively superior to the Frontier transaction, even considering its revised terms, and it continues to offer Spirit shareholders significantly more value, more cash, more certainty, and more regulatory protections,” JetBlue said in a press release.
Frontier has increased the per-share cash to $4.13 - up by $2 - in addition to the previously announced 1.9126 shares of Frontier per Spirit share and also agreed that $2.22 per share will be prepaid to Spirit shareholders as a cash dividend following approval of the transaction.
Colorado-based Frontier also has increased its reverse termination fee to $350 million to Spirit if the deal is not completed for antitrust reasons.
Picture Credit: Seeking Alpha
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