JetBlue Announces Another Prepayment to Spirit Stockholders

by Patrick Clarke
Last updated: 11:50 AM ET, Fri April 14, 2023

JetBlue has announced plans to make an additional prepayment to Spirit Airlines stockholders this April.

JetBlue agreed to a $3.8 billion merger with the ultra-low-cost carrier last summer in a move that would create the nation's fifth-largest airline. However, the deal has encountered hurdles in the months since, with the U.S. Department of Justice recently suing to block the acquisition.

The airline appears to be moving forward with the deal, nonetheless, issuing a prepayment to Spirit stockholders for $0.10 per Spirit share last month. JetBlue announced plans for another prepayment on Friday.

"As previously announced, in connection with the Agreement and Plan of Merger, dated as of July 28, 2022, by and among JetBlue Airways Corporation, Sundown Acquisition Corp., and Spirit Airlines, Inc., JetBlue has set April 24, 2023, as the record date for the April 2023 prepayment to Spirit stockholders of $0.10 per Spirit share (the “April 2023 Additional Prepayment”), with payment of the April 2023 Additional Prepayment to occur on April 28, 2023. Pursuant to the Merger Agreement, Spirit stockholders as of April 24, 2023, will be entitled to receive the April 2023 Additional Prepayment."

While the DOJ fears a JetBlue-Spirit merger will reduce competition leading to higher airfares for travelers, the airline claims that "JetBlue's combination with Spirit allows it to create a compelling national challenger to these dominant airlines, while also ensuring ultra-low-cost carriers options remain available in overlap markets."

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