by Donald Wood
Last updated: 9:20 AM ET, Wed June 8, 2022
Spirit Airlines announced it would delay a shareholder meeting until June 30 to vote on the proposed merger deal proposed by Frontier Airlines following an updated offer from JetBlue.
The original meeting was scheduled for June 10.
According to Retuers.com, Spirit officials said they were still recommending stockholders vote for the Frontier deal, but the company wants to do its due diligence following a proposal from JetBlue that included a higher reverse break-up fee.
A Spirit spokesperson told Reuters the company postponed the stakeholder meeting "to allow the Spirit Board of Directors to continue discussions with Spirit stockholders, Frontier and JetBlue Airways."
JetBlue CEO Robin Hayes issued the following statement on Spirit moving a scheduled shareholder meeting:
"We welcome this development as a necessary first step toward genuine negotiations between the Spirit Board and JetBlue. Spirit shareholders are clearly urging the Spirit Board to engage with us constructively and provide us with the same information previously made available to Frontier so that we can reach a consensual transaction."
"The improved proposal we submitted to the Spirit Board earlier this week clearly offers the most compelling value available for Spirit stockholders and we remain fully committed to acquiring Spirit. We are confident a combined JetBlue-Spirit will create a true national competitor to the dominant big four carriers that will result in lower fares and better service for customers, while offering Spirit shareholders the most attractive value creating opportunity available to them."
Last week, Frontier revealed it would pay the $250 million fee if the airline fails to complete the acquisition of the rival discount carrier. The deal would provide stockholders with the additional protection to feel more comfortable with the merger agreement.
In response, JetBlue offered an updated proposal that gives Spirit shareholders $31.50 per share in cash, which is comprised of $30 per share at deal close and the prepayment of $1.50 per share of the reverse break-up fee.
In an attempt to block the Spirit-Frontier merger, JetBlue initially offered a $3.6 billion deal to purchase Spirit, topping the first Frontier offer of $2.9 billion. Spirit executives believe the proposal from JetBlue would be blocked by the government, which is already scrutinizing the New York-based carrier's deal with American Airlines.
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