by Donald Wood
Last updated: 12:27 PM ET, Mon July 11, 2022
Frontier Airlines announced it would no longer raise its bid to purchase Spirit Airlines, possibly opening the door for JetBlue Airways to finalize the takeover of the low-cost carrier.
According to Reuters.com, Frontier CEO Barry Biffle said in a letter sent to Spirit officials that its revised merger agreement from last month would be the airline's "last, best and final offer."
Biffle also said Frontier would be willing to waive its right to match JetBlue's latest offer.
"In line with our recent discussions, Frontier does not intend to propose any further modifications to the financial terms of the Merger Agreement," Biffle said in the letter obtained by Reuters.
Frontier initially worked out a cash-and-stock deal with Spirit in February, but JetBlue added its name to the mix in April with a superior offer that kicked off a war of words between the airlines.
Frontier eventually increased the cash component of the deal by $2 per share to $4.13 per share and its reverse termination fee to Spirit by $100 million to $350 million. In response, JetBlue offered a higher bid, raising the overall value of its bid to $3.7 billion in cash.
As a result of the bidding war, Spirit repeatedly delayed a shareholder vote to decide which offer would benefit the company most in the long- and short-term.
Spirit announced last week that it would adjourn its July 8 meeting and reconvene on July 15 to vote on which offer would be best for shareholders. JetBlue CEO Robin Hayes released a statement on the decision.
"We are encouraged by our discussions with Spirit and are hopeful they now recognize that Spirit shareholders have indicated their clear, overwhelming preference for an agreement with JetBlue," Hayes said. "We strongly recommend that Spirit shareholders continue to let the Spirit Board know they want to receive the superior value JetBlue has proposed, by voting AGAINST the Frontier transaction."
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