Spirit postpones Frontier deal vote to continue talks with Frontier and JetBlue

July 7 (Reuters) – Spirit Airlines Inc (SAVE.N) said it has postponed a shareholder vote scheduled for Friday on its $2.4 billion sale to Frontier Group Holdings Inc (ULCC.O). its board can continue discussions with Frontier and JetBlue Airways.

Reuters initially reported the planned delay.

In recent months, JetBlue and Frontier, led by influential airline investor Bill Franke, have repeatedly sweetened their bids for Spirit to create the fifth-largest US airline.

Sign up now for FREE unlimited access to Reuters.com

Spirit’s shareholders’ vote, previously postponed twice, will be postponed a third time to give Spirit and JetBlue time to finalize a deal, sources told Reuters, asking not to be identified because the talks are confidential.

Spirit said it now plans to hold a special meeting on July 15.

JetBlue CEO Robin Hayes said in a statement the airline was “encouraged by our discussions with Spirit and hope they now recognize that Spirit shareholders have expressed their clear, overwhelming preference for an arrangement with JetBlue.” .

JetBlue submitted a sweetened $3.7 billion cash offer last month, but Spirit has declined to accept JetBlue’s much more financially attractive offer amid concerns that antitrust authorities could turn it down, the sources said.

JetBlue is already facing a lawsuit from the US Department of Justice over its partnership with American Airlines (AAL.O) in the New York and Boston areas.

There is no certainty that JetBlue Spirit will provide the necessary assurances on the regulatory front to reach an agreement, and Frontier, which has already upgraded its offering, may come back with a new one, the sources added.

The frontier deal is also expected to face antitrust scrutiny. But Spirit and some analysts say the deal has a better chance of getting a nod from regulators.

Both bidders view Spirit as an opportunity to expand their domestic presence and reshape the US airline industry, which is largely dominated by four domestic carriers. A takeover by either bidder would come at a time when the industry is currently struggling with labor and aircraft shortages.

Last week, Spirit was forced to postpone the shareholder vote until July 8th. The sources said it did not have enough shareholders to support the frontier deal at the time.

Sign up now for FREE unlimited access to Reuters.com

Reporting by Anirban Sen and Svea Herbst-Bayliss in New York and David Shepardson in Washington; additional reporting by Rajesh Kumar Singh; Edited by Greg Roumeliotis, Bill Berkrot and Edwina Gibbs

Our standards: The Thomson Reuters Trust Principles.