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.
“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.