JetBlue has offered another more hostile bid for Spirit Airlines this week and made further attempts to derail the Frontier merger.

JetBlue’s new offer

JetBlue put in an aggressive new offer for Spirit this week, hoping to win against Frontier in the battle for the low-cost airline. The latest bid is for $3.3 billion, $3 billion less than the one that Spirit rejected a few months ago. The company says they are still willing to pay its original price should a “consensual transaction” be agreed upon. The offer still greatly exceeds Frontier’s sum of $2.9 billion.

JetBlue offer Spirit less than before, pitting against Frontier merger
JetBlue’s new offer is more hostile than the last | © Matt Boucher

Last month, Travel Radar reported on JetBlue’s original unsolicited offer for Spirit. The airline was proposing $33 a share in cash, as opposed to Frontier’s offer of 1.9126 shares of stock and $2.13 billion cash. The offer was rejected, as Spirit was concerned that antitrust issues would stop it from going through. JetBlue is currently facing an antitrust lawsuit brought against them by the Department of Justice, following their alliance with American Airlines. Spirit is worried a merger would attract similar problems. The merger would make JetBlue the fifth largest US airline.

The two airlines are a far from a perfect match. Spirit operates under the ultra-low-cost model, offering flights at rock-bottom prices, with passengers paying for any “extras” such as baggage. However, JetBlue targets a different demographic, offering a full-service product for their customers. For this and other reasons, some had speculated that JetBlue’s initial offer was merely an attempt to derail the Frontier-Spirit merger rather than a sincere attempt to buy. But their latest proposal suggests genuine intentions.

Appeal to Spirit Shareholders

JetBlue has set up a website called “JetBlueOffersMore.com“, addressing Spirit shareholders and urging them to vote against the Frontier Merger. The website emphatically asserts that they can offer more value, more certainty and more opportunities for crewmembers. They also accuse Spirit of misgovernance, highlighting the controversial role of Bill Franke in the Frontier merger.

Jet Blue accuse Bill Franke, Chairman of Frontier, regarding spirit merger
Bill Franke, Chairman of Frontier | © Flight Global

Until 2013, Spirit was owned by Franke’s company, Indigo Partners. The firm sold its share in Spirit to buy Frontier out of bankruptcy, converting it to an ultra-low-cost model. Indigo partners still own a majority share in Frontier, with Franke serving as the airline’s chairman. JetBlue says that Indigo is the driving force behind the Spirit deal, and accuses Spirit’s board of “prioritizing its own self-interest and personal relationships with Frontier over its shareholders’ interests,”.

Who do you think should win the spirit merger? Let us know in the comments below?

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