The board of directors for Spirit Airlines has unanimously determined that an offer from JetBlue Airways to acquire all outstanding shares of Spirit’s common stock was not in the best interests of the airline and its stockholders. The board’s Thursday announcement came in response to JetBlue filing a proxy statement and launching a website last week urging Spirit shareholders to vote against a proposed merger between Spirit and fellow ultra-low-cost carrier (ULCC) Frontier Airlines in favor of a merger with JetBlue. Spirit’s board cited continued concerns that the JetBlue transaction would be unlikely to clear antitrust regulations and the associated financial difficulties a failed merger would cause.
“JetBlue’s tender offer has not addressed the core issue of the significant completion risk and insufficient protections for Spirit stockholders,” said Mac Gardner, chairman of the board of directors for Spirit Airlines. “Based on our own research and the advice of antitrust and economic experts, our view is that the proposed combination of JetBlue and Spirit lacks any realistic likelihood of obtaining regulatory approval, while our company faces a long and bleak limbo period as we await resolution.”
JetBlue has put forward a series of offers for Spirit with its most recent, made on May 13, coming in about 60 percent higher than Frontier’s bid. In a statement issued in response to the board’s announcement, JetBlue once again called on shareholders to vote against the transaction with Frontier, noting that it believes its offer shares a similar risk profile regarding regulatory approval. Spirit is planning to hold a special meeting of its stockholders on June 10 to vote on the proposed merger with Frontier.