JetBlue now trying hostile takeover in its bid to acquire Spirit Airlines
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
JetBlue is not giving up on its efforts to acquire Spirit Airlines.
Two weeks after JetBlue’s initial acquisition attempt was spurned by Spirit’s board of directors, the New York-based airline launched a new, two-part hostile offensive on Monday aimed at Spirit’s individual shareholders, its latest proposal to acquire the ultra-low-cost carrier. For its part, Spirit hopes to close a merger deal with Frontier Airlines soon.
Want more airline-specific news? Sign up for TPG’s free new biweekly Aviation newsletter.
First, JetBlue formally urged Spirit’s shareholders to reject the carrier’s pending merger with Frontier. That deal goes to a formal vote at a special shareholder meeting on June 10. To make its case directly to Spirit’s shareholders, JetBlue launched a new website, jetblueoffersmore.com.
JetBlue also launched a tender offer, in which it will offer $30 for each Spirit share that is tendered (sold) to JetBlue directly by Spirit’s shareholders. JetBlue’s original offer to Spirit’s board was $33 a share, and JetBlue promised to increase its tender offer to $33, “subject to receiving necessary diligence” from Spirit.
Two weeks ago, JetBlue prominently noted that Spirit’s board stopped cooperating and providing information at some point during their initial negotiations.
While lower than its original offer, JetBlue still views the tender offer as “superior” to the return that Spirit’s shareholders will receive if they green-light the merger with Frontier.
“JetBlue offers you $30 per share in cash, representing a 60% premium to the value of the Frontier transaction as of May 13, 2022, a 77% premium to Spirit’s latest closing price, and a 38% premium to Spirit’s unaffected share price – a very compelling value, and, no matter how you measure it, a higher premium than in our original proposal,” JetBlue CEO Robin Hayes wrote in a letter to Spirit’s shareholders.
In a letter to Spirit’s CEO, Ted Christie, and its board chairman, H. McIntyre Gardner, Hayes claims that JetBlue has trying to acquire Spirit for some time.
“Acquiring Spirit has been a strategic objective of JetBlue for many years and, as such, we were disappointed that the Spirit Board of Directors (the “Spirit Board”) elected not to have any discussions with us prior to the announcement of Sprit’s transaction with Frontier Group Holdings, Inc. (“Frontier”),” Hayes wrote.
Monday’s news comes after JetBlue added what it called enhancements to its original offer for Spirit, in the days prior to Spirit’s board rejecting the offer.
In a statement, Spirit acknowledged the tender offer and promised to advise its shareholders on its board’s position within 10 business days.
Wall Street analysts noted JetBlue’s persistence on Monday.
“JetBlue is not giving up,” Cowen analyst Helane Becker wrote in a Monday note, while adding that both possible tie-ups require regulatory approval, which is uncertain.
Featured Photo by Zach Griff/The Points Guy.
Welcome to The Points Guy!
Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.
- Limited Time Offer: Earn 90,000 bonus miles after you spend $3,000 in purchases on your new Card in your first 3 months. Offer ends 8/3/2022.
- Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs up to two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
- Earn 3X Miles on Delta purchases and purchases made directly with hotels.
- Earn 2X Miles at restaurants worldwide including takeout and delivery in the U.S., and at U.S. supermarkets.
- Earn 1X Miles on all other eligible purchases.
- Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. Payment of the government imposed taxes and fees of no more than $80 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
- Enjoy your first checked bag free on Delta flights.
- Fee Credit for Global Entry or TSA PreCheck® after you apply through any Authorized Enrollment Provider. If approved for Global Entry, at no additional charge, you will receive access to TSA PreCheck.
- Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees