LaGuardia International Airport, Terminal A of JetBlue Airways and Spirit in New York.
Leslie Josephs | CNBC
JetBlue said it will pay $33.50 per share in cash to Spirit in a $3.8 billion deal.
JetBlue’s acquisition of Spirit would create the nation’s fifth largest carrier and, if approved by regulators, would leave Frontier as the largest discount company in the United States.
JetBlue’s surprise, all-cash bid to buy Spirit in April has called Spirit’s plan to merge with fellow Frontier affiliate into question. For months, Frontier and JetBlue vied for Spirit, each sweetening their bids, until the original merger plan collapsed earlier Wednesday, paving the way for JetBlue.
Spirit said it plans to continue talks to sell itself to JetBlue after the border agreement is terminated.
JetBlue executives have argued for months that buying Florida-based Miramar would help it compete with big carriers like AmericanAnd the DeltaAnd the united And the Southwestwhich controls most of the US market, is accelerating its growth by giving it access to more Airbus planes and pilots, both of which are in short supply.
New York-based JetBlue wants to revamp its Spirit jets in JetBlue style, which feature seat back screens and more legroom.
Spirit previously rejected JetBlue’s offers and said such a deal was unlikely to be approved by regulators, in part because of JetBlue’s alliance with American, which the Justice Department sued to block it last year.
The deal faces a significant hurdle for regulatory approval.
Spirit shares are up more than 4% in premarket trading after the deal was announced, while JetBlue shares are up 0.5%.