Skift Breaking News Blog

Short stories and posts about the daily news happenings around the travel industry.

Airlines

JetBlue Ups Breakup Fee in Spirit Airlines Bidding War Move

2 hours ago

JetBlue Airways is not done yet trying to acquire Spirit Airlines. With just three days until shareholders vote, the New York-based carrier has upped its offer again, raising its reverse breakup fee to $400 million to beat rival bidder Frontier Airlines.

JetBlue’s latest offer — its fourth for Spirit — also includes a prepayment of $2.50 per share of the breakup fee, and a “ticking fee mechanism” where the airline would pay Spirit shareholders an additional $0.10 per share monthly from January 2023 until the deal closed, JetBlue said Monday. The ticking fee could increase JetBlue’s overall offer to as much as $34.15 per share. Its last offer was for $33.50 per share plus a $350 million breakup fee.

(vic_206/Flickr)

“We’ve discussed our offer directly with Spirit shareholders and are now modifying our proposal in response to shareholders’ expressed interest, to include a monthly payment for shareholders, with the certainty of a significant cash premium at closing,” JetBlue CEO Robin Hayes said Monday.

And, in a letter directly to Spirit shareholders, Hayes said the airline’s board has “never negotiated with us and have now favored a transaction that better serves Frontier’s controlling shareholder than Spirit’s shareholders.”

Frontier’s latest offer, unveiled on June 24, included an additional $2 per share for a total of $4.13 a share, plus a $350 million reverse break up fee. The offer was valued at $2.7 billion based on closing stock prices that day.

Spirit shareholders will vote to accept or reject Frontier’s offer on June 30.

Mergers and Acquisitions

Hospitality Management Platform Cloudbeds Acquires Messaging Service Whistle

6 hours ago

Cloudbeds, a San Diego-based software company that helps independent hotels set their set their rooms and market their inventory online, announced on Monday at HITEC 2022 that it’s acquiring hotel messaging software Whistle.

The move is part of Cloudbeds’ strategy to facilitate communication between accommodation providers and guests.

“The term contactless is becoming far too synonymous with hospitality,” said Richard Castle, Cloudbeds’ chief operator officer and co-founder. “We want more contact between lodging businesses and their guests to create purposeful touchpoints, answer questions and provide guidance through the entire guest journey.” 

Cloudbeds attracted $150 million worth of investment last year, led by Softbank. Meanwhile, Whistle’s clients include major international hospitality brands such as Choice Hotels, Accor and IHG Hotel & Resorts.

Cruises

A&K Travel Group Acquires Crystal Cruises Ships

5 days ago

The A&K Travel Group — the company owned by Geoffrey Kent, CEO of tour operator Abercrombie and Kent, and industrial holding corporation Heritagehas acquired cruise ships Crystal Serenity and Crystal Symphony in addition to the Crystal Cruises brand.

Both Crystal Serenity and Crystal Symphony were acquired at an auction with the former ship going for $25 million while the latter was sold for $103 million. A&K said the two ships will resume service next year after undergoing extensive refurbishment and will operate under the Crystal Cruises brand. Crystal Cruises had ceased operations in January this year following the collapse of parent company Genting.

Crystal Symphony and Crystal Serenity ships were both seized in the Bahamas by U.S. marshals the following month after a federal judge issued an arrest warrant for Crystal Symphony. A lawsuit alleged Crystal Cruises had more than $4 million of unpaid fuel bills.

A Crystal Symphony ship (Wikimedia Commons)

Airlines

JetBlue Ups Offer for Spirit Airlines Again, Now Totaling $3.7 Billion

1 week ago

With the likelihood improving of a successful bid for Spirit Airlines, JetBlue Airways has raised its offer for the discounter a second time in as many weeks.

The New York-based airline is now offering Spirit shareholders $33.50 per share, or a total of $3.7 billion, JetBlue said Monday. That is a $2 per share improvement over its last offer of $31.50 a share that it made on June 6, and $0.50 more than it initial offer in April of $33 per share.

“After discussions with the Spirit team last week and further due diligence review, we are more convinced than ever that a JetBlue-Spirit transaction would create a true national competitor to the Big Four and deliver value to all of our stakeholders,” JetBlue CEO Robin Hayes said.

(Ryan McLean/Flickr)

“Our previous proposal was met with an extremely positive reaction from Spirit stockholders, and we believe they will be even more pleased with these improved terms, including additional regulatory commitments that reflect our confidence in our ability to obtain antitrust approval and are a direct result of our diligence,” Hayes added.

With regulatory approval the top of concern of Spirit’s leadership team, JetBlue reiterated its commitment to divest all of Spirit’s assets in Boston and New York, as well as gates at the Fort Lauderdale airport where both airlines have bases. The airline told Spirit’s board Monday that it would “not increase its presence in the airports covered by our Northeast Alliance” with American Airlines if the deal occurs.

Spirit has twice rejected JetBlue favoring, instead, its preferred merger partner Frontier Airlines. However, after JetBlue’s last offer, Spirit gave the carrier the same level of access to due diligence data that it had granted Frontier — something JetBlue had been seeking for months.

Denver-based Frontier declined to improve its offer, which totals roughly $2.9 billion in cash and stock, after JetBlue raised its bid on June 6.

A JetBlue-Spirit merger would create the fifth largest U.S. airline.

Airlines

Spirit Airlines Is ‘Engaging’ With JetBlue Over Its Improved Offer

2 weeks ago

Days after J.P. Morgan published a report stating the likelihood of a merger between Spirit Airlines and JetBlue Airways was improving, Spirit has said its board of directors was “engaging in discussions” with JetBlue following its improved offer.

The board was also continuing to work with Frontier under the terms of the existing merger agreement with Frontier, Spirit president and CEO Ted Christie said Tuesday.

“As part of this process, Frontier and JetBlue are being given access to the same due diligence information, on the same terms. The board expects to bring the process to a conclusion and provide an update to stockholders ahead of the special meeting of Spirit stockholders scheduled for Thursday, June 30, 2022,” it said in a statement.

Spirit had previously delayed that key shareholder vote on a merger — either with Frontier Airlines or JetBlue — by three weeks.

“Spirit continues to be bound by the terms of its merger agreement with Frontier, under which a ‘Superior Proposal’ is defined as being both reasonably capable of being consummated and more favorable to Spirit’s stockholders from a financial point of view,” the statement added.

Airlines

JetBlue-Spirit Merger Chances Improving: Analyst

2 weeks ago

A new report from J.P. Morgan analyst Jamie Baker sees the likelihood of a merger between JetBlue Airways and Spirit Airlines improving. The comments come days after JetBlue improved its offer for Spirit by more than $150 million, and the latter delayed a key shareholder vote on a merger — either with Frontier Airlines or JetBlue — by three weeks to June 30.

“We believe some merger involving Spirit is a high probability outcome,” Baker wrote Thursday. “We also believe a merger outcome between Spirit and JetBlue is a growing probability and may overtake the likelihood of a Frontier deal.”

(jtocchialini/Flickr)

JetBlue is offering Spirit shareholders $31.50 per share that totals roughly $3.4 billion. The offer includes a $1.50 per share prepayment of a $350 million break up fee in the event U.S. regulators do not approve the deal. Frontier is offering Spirit investors the equivalent to $2.9 billion in cash and stock.

On June 6, following receipt of JetBlue’s improved offer, Frontier declined to raise its bid for Spirit, Securities & Exchange Commission filings show.

Airlines

Spirit Airlines Delays Merger Vote to June 30

3 weeks ago

Spirit Airlines shareholders have another 20 days to decide whether they support a merger with Frontier Airlines or prefer a hostile, but potentially more lucrative if it’s approved by regulators, takeover by JetBlue Airways. The vote was previously scheduled for Friday, June 10.

Florida-based Spirit said Wednesday that the delay to June 30 allowed the airline’s board to “continue discussions” with shareholders, Frontier, and JetBlue.

(ajay_suresh/Flickr)

On Monday, JetBlue improved its offer to Spirit shareholders by more than $150 million to an all-cash $3.4 billion. Frontier is offering shareholders the equivalent to $2.9 billion in cash and stock.

Whoever Spirit decides to merge with, Frontier or JetBlue, will become the fifth largest U.S. carrier after American Airlines, Delta Air Lines, Southwest Airlines, and United Airlines.

Airlines

JetBlue Sweetens Deal For Spirit Airlines in Proxy War Volley

3 weeks ago

JetBlue Airways has raised its bid to takeover Spirit Airlines in the latest volley in an escalating proxy war with Frontier Airlines.

JetBlue upped its reverse break-up fee on Monday to $350 million — $100 million more than Frontier — and offered to pre-pay $164 million of said fee in its latest offer to Spirit shareholders. All in, the offer values Spirit at $31.50 per share.

(vic_206/Flickr)

The offer comes less than a week after Frontier improved its offer for Spirit with a $250 million reverse break-up fee.

“Combining JetBlue and Spirit would create a true national competitor to the dominant legacy carriers, delivering low fares and a great experience for more customers, more opportunities and good paying jobs for crewmembers and team members, and more value for stockholders,” JetBlue CEO Robin Hayes said in a letter to the Spirit board. “The key features of our improved proposal – the up-front cash payment and increased reverse break-up fee – are not an illusion. This offer reflects the seriousness of our commitment and underscores our confidence in completing this transaction. Additionally, given the similar regulatory risks of the two transactions and the increased reverse break-up fee we are prepared to provide, we believe our Improved Proposal remains a Superior Proposal by any measure.”

Spirit shareholders are scheduled to vote on the Frontier merger proposal on June 10. The vote is the culmination of a four-month saga since Frontier and Spirit first announced plans to merge. JetBlue unveiled an unsolicited bid for Spirit in April, which the latter carrier rejected. JetBlue is now attempting a hostile takeover by asking Spirit shareholders to reject the Frontier deal.

Follow the Latest Headlines

Airlines

Spirit Airlines Rejects JetBlue, Again

1 month ago

The board at Spirit Airlines took little time in weighing in on JetBlue Airways’ hostile takeover bid. The New York-based carrier’s latest $30-per-share offer “is NOT in the best interests of Spirit and its stockholders,” the board said Thursday.

“JetBlue’s tender offer has not addressed the core issue of the significant completion risk and insufficient protections for Spirit stockholders. Based on our own research and the advice of antitrust and economic experts, our view is that the proposed combination of JetBlue and Spirit lacks any realistic likelihood of obtaining regulatory approval, while our company faces a long and bleak limbo period as we await resolution,” said Mac Gardner, Chairman of the Board of Directors for Spirit Airlines, in a statement.

JetBlue fired back with its own statement: “The Spirit board, driven by serious conflicts of interest, continues to ignore the best interests of its shareholders by distorting the facts to distract from their flawed process and protect their inferior deal with Frontier. Regarding regulatory approval, Spirit would have you ignore the current regulatory climate to think that approval of their Frontier deal is assured. That is simply not true. Both deals are subject to regulatory review, and both deals have a similar risk profile.”

JetBlue launched its hostile takeover on May 16, nearly two weeks after the Spirit board rejected an unsolicited offer from the airline. The Spirit board supports a merger with Frontier Airlines, which shareholders will vote on on June 10. The Frontier-Spirit combo also has the backing of both airlines flight attendant union.

Airlines

Flight Attendant Unions Back Frontier-Spirit Merger

1 month ago

The flight attendant unions representing cabin crew members at Frontier Airlines, JetBlue Airways, and Spirit Airlines are backing a merger of Frontier and Spirit, or at least opposing JetBlue’s hostile takeover attempt of Spirit.

The Association of Flight Attendants-CWA (AFA), which represents flight attendants at Frontier and Spirit, said May 17 that it had reached a merger transition agreement with Frontier. The agreement would oversee the integration of cabin crew groups at Frontier and Spirit if the merger goes ahead.

“We are thrilled to announce our support for the merger of Spirit and Frontier Airlines after reaching a transition agreement that protects flight attendant jobs,” AFA International President Sara Nelson said. “We support the necessary regulatory approvals that will improve competition, increase consumer options and experience, and maintain and grow good union jobs.”

On Wednesday, the Transport Workers Union (TWU), which represents flight attendants at JetBlue, came out firmly against the New York-based airline’s hostile takeover attempt. “After thoughtfully considering the impact that a JetBlue acquisition of Spirit Airlines would have on customers and our workforce, the TWU fully opposes JetBlue’s proposed hostile takeover. JetBlue has proven itself to be an abusive employer by disregarding the well-being of its workforce, and refusing to abide by its existing union contracts,” TWU International President John Samuelson said.

Spirit shareholders will decide the fate of the airline. They are scheduled to vote on a combination with Frontier on June 10, which the Spirit board supports and JetBlue opposes through a separate tender offer.

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