Just two weeks after Spirit Airlines board rejected JetBlue’s inital buy out offer, the airline is back with a new offer and a website to explain the airline’s shareholders should reject Frontier’s ‘inferrior’ offer.
On Monday, JetBlue rolled out a revised offer that includes a $30 per share offer (with room for up to $33 a share) in an all cash transaction. Their website listed a number of reasons why the offer is superior to Frontier’s previous offer.
In a statement to Spirit’s shareholders, JetBlue’s CEO says, “JetBlue offers more value – a significant premium in cash – more certainty, and more benefits for all stakeholders. 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. The Spirit Board based its rejection on unsupportable claims that are easily refuted.”
“Ask yourself a simple question: why won’t the Spirit Board engage with us constructively? The interests of Bill Franke’s Indigo Partners and the long-standing relationships between the two companies is the obvious answer.”
With this offer, JetBlue is asking shareholders to vote no on the Frontier Merger offer. The full website is available here for our readers to view.
Why the merger opportunity is so important to JetBlue
JetBlue sees Spirit as one of the last major opportunities to quickly create a larger carrier. Back in 2016, the airline lost a competition to merge with Virgin America. The missed opportunity meant that other competitors like Southwest, Alaska, American and Delta all grew larger through mergers. Now with a potential tie up between Frontier and Spirit, they would be forced to compete against an ultra-low cost carrier that rivals the size of a major airline.
We’ll update this story if Spirit or Frontier Airlines post a response.
