A JetBlue airliner lands past a Spirit Airlines jet on taxi way at Fort Lauderdale Hollywood International Airport on Monday, April 25, 2022. (Joe Cavaretta/Sun Sentinel/Tribune News Service via Getty Images)
Joe Cavaretta | Sun Sentinel | Getty Images
Spirit Airlines CEO Ted Christie on Thursday laid bare the explanations his company rejected JetBlue Airways’ $3.6 billion offer to purchase the ultra-low-cost carrier, and went to date as to suggest that the bid could have been intended to stop Spirit’s planned merger with Frontier Airlines.
“JetBlue shareholders aren’t supportive of this deal, either, based on the corporate’s stock performance. Nonetheless, despite clear concern from JetBlue shareholders, JetBlue has continued to pursue disruption to the Spirit-Frontier combination,” Christie said during Spirit’s first-quarter earnings call.
“I actually have wondered whether blocking our take care of Frontier is the truth is their goal,” Christie added.
JetBlue declined to comment on Christie’s claims.
In February, Spirit and Frontier announced plans to merge in what would create a large discount airline, the fifth-largest carrier within the U.S. JetBlue’s unsolicited bid for Spirit initially threw that tie-up into query. But on Monday, Spirit rejected JetBlue’s offer in favor of the Frontier deal, citing concerns that a JetBlue buyout would not clear regulatory hurdles.
JetBlue has a partnership with American Airlines in what’s often known as the Northeast Alliance (NEA) to raised compete against the likes of United Airlines and Delta Air Lines at major airports. JetBlue contends that acquiring Spirit would help it further compete.
Christie on Thursday emphasized that the Department of Justice is already suing to dam the JetBlue-American partnership, while highlighting that “half the expected synergies” of JetBlue absorbing Spirit “would come from reduced capability and increased fares to consumers.”
“You do not should be an antitrust attorney to see the problems here,” Christie said. “It stretches any form of common sense to imagine that an acquisition of Spirit by JetBlue can be approved by the DOJ while it’s suing to dam the NEA.”
Spirit said it submitted a counteroffer to JetBlue – including abandoning the NEA with American – but JetBlue rejected the choice proposal.
JetBlue CEO Robin Hayes wrote in a letter to Spirit’s CEO and its chairman on April 29 that its offer stands a greater likelihood of clearing regulators than the Frontier merger.
“We firmly imagine that it’s in one of the best interest of your stockholders for you to simply accept our Proposal, which has significantly greater odds of achieving regulatory clearance given the stronger regulatory commitment on our part in comparison with Frontier,” Hayes wrote then.