by Donald Wood
Last updated: 8:00 AM ET, Wed February 12, 2025
Spirit Airlines announced on Tuesday night that it had rejected
Frontier Group's revised
acquisition offer, worth an estimated $2.16 billion.
According to CBSNews.com,
Frontier's latest offer included Spirit shareholders getting $400 million in
debt and a 19 percent stake in the low-cost carrier, which was similar to the
first proposal sent earlier this month.
The difference with the latest offer was that Frontier dropped
a requirement that Spirit would need to complete a $350 million equity rights
offering. In addition, the proposal would have required Spirit to waive the bankruptcy
court-approved $35 million termination fee.
“We remain convinced that the combination of Spirit and
Frontier would have created more value than Spirit's standalone plan,” a Frontier
spokesperson said in a statement.
In response, officials from Spirit said the revised
proposal did not address several major issues the airline had with the
first offer. The low-cost carrier filed for bankruptcy protection last year and
expects to complete its restructuring in the first quarter.
Spirit sent a counteroffer to Frontier, asking for $600
million in debt and $1.185 billion in equity, a deal that Frontier rejected.
Spirit and Frontier have been negotiating a possible merger
since 2022, but a lack of an agreement and an offer from JetBlue Airways that
was shut down by the United States government have stopped any momentum.
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