Spirit says no to JetBlue acquisition offer, again
Spirit Airlines is asking its shareholders to reject a hostile bid by JetBlue to acquire the company and instead back its merger with Frontier Airlines.
It's the second time in as many weeks that Spirit has rejected an offer by JetBlue.
The move comes after JetBlue on Monday announced a $30 per share tender offer to acquire Spirit's outstanding shares. In a tender offer, an acquiring company approaches individual shareholders and offers to purchase their holdings at a premium. Spirit's shares closed at $19.42 on Wednesday.
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"JetBlue's tender offer has not addressed the core issue of the significant completion risk and insufficient protections for Spirit stockholders," Mac Gardner, Spirit's board chairman, said in a statement.
In rejecting the hostile bid on Thursday, Spirit laid out a number of its concerns, primarily related to regulatory approval and anti-trust matters. Analysts believe that JetBlue's Northeast Alliance with American Airlines presents a major regulatory challenge for any deal with Spirit, though JetBlue has promised to divest itself of Spirit's northeast assets — but not necessarily its own alliance with American — if it acquires the latter. Regulatory approval for Spirit's deal with Frontier is also uncertain, but many believe it has better chances than the JetBlue one.
It's a point that JetBlue highlighted in its own statement responding to Spirit's rejection.
"Regarding regulatory approval, Spirit would have you ignore the current regulatory climate to think that approval of their Frontier deal is assured," JetBlue said. "That is simply not true."
JetBlue's original offer had been for $33 per share, and in its hostile bid, JetBlue had promised to increase its offer from $30 to $33 if Spirit started sharing more information with JetBlue. It seems likely that won't happen.
More: JetBlue now trying hostile takeover in its bid to acquire Spirit Airlines
In a Thursday appearance on CNBC's "Squawk Box," Spirit CEO Ted Christie strongly rejected the assertion that it wasn't sharing enough information with JetBlue.
"Well [JetBlue CEO] Robin [Hayes] and I have spoken over the last month," Christie said. "And yes, I am frustrated by the commentary because to imply that our board didn't go through its diligence is a misstatement, and quite frankly it's insulting."
Spirit's merger deal with Frontier now goes to Spirit's shareholders, who will vote on it on June 10 — a vote that JetBlue is strongly urging the shareholders to vote against.
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- Earn bonus Medallion® Qualification Miles (MQMs) and an Medallion Qualifying Dollar (MQD) waiver when you hit specific spending thresholds with your card within a calendar year
- Receive a Domestic Main Cabin round-trip companion certificate each year
- Statement credit for TSA PreCheck/Global Entry fee (up to $100)
- First checked bag free
Cons
- Doesn't make sense if you don't fly Delta
- SkyMiles aren't the most valuable airline currency
- Earn 90,000 bonus miles after you spend $4,000 in purchases on your new Card in your first 6 months.
- 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. Plus enjoy Main Cabin 1 Priority Boarding and settle into your seat sooner.
- New: Card Members get 15% off when using miles to book Award Travel on Delta flights through delta.com and the Fly Delta app. Discount not applicable to partner-operated flights or to taxes and fees.
- 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 Mile on all other eligible purchases.
- Enjoy a per-visit rate of $50 per person for Card Members and up to two guests to enter the Delta Sky Club when traveling on a Delta flight.
- 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.
- 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.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees