Spirit Airlines planes are shown at the George Bush Intercontinental Airport in Houston (Photo by Brandon Bell/Getty Images)
Spirit Airlines shares surged Monday after JetBlue Airways launched a hostile takeover for the discount carrier.
JetBlue (ticker: JBLU) has begun a tender offer for Spirit (SAVE) shares. Spirit rejected JetBlue’s $3.6 billion takeover proposal earlier this month, opting to stick with a lower-priced bid from Frontier Group (ULCC).
“Given the Spirit Board of Directors’ complete unwillingness to share the same necessary diligence information that was shared with Frontier, JetBlue is now offering to acquire Spirit for $30 per share in cash through a fully financed tender offer,” JetBlue said in a statement Monday.
“This represents a 60% premium to the value of the Frontier transaction as of May 13, 2022 — a very compelling offer and higher than the premium implied by JetBlue’s original proposal. JetBlue is fully prepared to negotiate in good faith a consensual transaction at $33, subject to receiving necessary diligence,” the airline added.
JetBlue also urged Spirit shareholders in a letter to vote against what it called “the inferior, high risk, and low value Spirit/Frontier transaction” at Spirit’s special meeting next month.
Spirit shares jumped 18.2% in premarket trading Monday to $20.07. JetBlue traded flat. Frontier shares were inactive in premarket trading.
Spirit didn’t immediately respond to a request for comment from Barron’s on Monday.
Write to Joe Woelfel at [email protected]
