Spirit Rejects Frontier's Merger Proposal
Deal News | Jan 29, 2025 | EIN
Frontier Group Holdings, Inc., the parent of Frontier Airlines, has officially announced an attempted merger with Spirit Airlines that was rejected for being financially insufficient by Spirit. Frontier's proposal involved issuing new debt and stock and was touted to provide substantial value above Spirit's independent restructuring plan, especially considering the synergies anticipated from merging operations. Bill Franke, Frontier's Chair, asserted that the merger would form a stronger low-cost airline, unlocking additional value creation opportunities. Despite Frontier's belief in the merger, Spirit, currently in Chapter 11 bankruptcy, views the offer as inadequate and intends to exit bankruptcy by Q1 2025. This proposal marks another failed merger attempt following a blocked deal with JetBlue.
Sectors
- Airlines
- Corporate Finance
- Mergers and Acquisitions
Geography
- United States – Both Frontier Airlines and Spirit Airlines are based in the United States, and the adoption of Chapter 11 bankruptcy proceedings indicates US jurisdiction.
Industry
- Airlines – The article discusses an attempted merger between two airlines, Frontier and Spirit, in the low-cost carrier sector.
- Corporate Finance – The merger involves significant financial structuring including issuance of debt and stock, relevant to corporate finance operations.
- Mergers and Acquisitions – The article's primary focus is on the merger proposal by Frontier to acquire Spirit, which got rejected.
Financials
- $3.8 billion – The blocked acquisition offer value from JetBlue to Spirit in a previous deal attempt.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Frontier Group Holdings, Inc. | Bidding Company | Company | Parent organization of Frontier Airlines, proposing the merger with Spirit Airlines. |
| Spirit Airlines, Inc. | Target Company | Company | The airline in Chapter 11 bankruptcy that rejected Frontier's merger proposal. |
| Indigo Partners LLC | Other Company | Company | Managing partner involved in the merger process through Bill Franke. |
| Bill Franke | Chair of Frontier's Board of Directors | Person | Managing partner of Indigo Partners LLC, advocating for the merger proposal. |
| Barry Biffle | CEO of Frontier | Person | Championed the merger proposal expressing potential benefits to consumers and stakeholders. |
| JetBlue Airways | Other Company | Company | Presented a previous merger proposal to Spirit that was blocked by a federal judge. |