JetBlue has submitted a new proposal to the board of directors of Spirit Airlines to acquire all of Spirit’s outstanding common stock. The offer is the latest in a series JetBlue has made for the ultra-low-cost carrier (ULCC), which Spirit has so far rejected citing a low probability of obtaining antitrust clearance. JetBlue’s “improved” offer increases the reverse termination fee payable to Spirit if the transaction doesn’t go through for antitrust reasons from $200 million to $350 million along with offering $31.50 per share to include $30 per share in cash at the closing of the transaction and a prepayment of $1.50 per share, also in cash, of the reverse termination fee.
I find it curious that there are anti-trust concerns for JetBlue when United merged with Continental, American bought US Airways, and Delta merged with Northwest (among other examples).
It appears to me that Jet Blue is trying really hard to prevent Spirit from merging with Frontier. That merger would create a major competitor to Jet Blue. According to other information I have read, Spirit and Jet Blue operating areas significantly overlap, which is one reason why the SEC may consider it an anti-trust action. However, as mentioned above, the merger of several legacy carriers calls into question how aggressive the government might be in Jet Blue’s case.