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Spirit CEO says he wonders whether or not JetBlue's bid was meant to dam Frontier deal

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A JetBlue airliner lands previous a Spirit Airlines jet on taxi approach at Fort Lauderdale Hollywood International Airport on Monday, April 25, 2022. (Joe Cavaretta/Sun Sentinel/Tribune News Service through Getty Images)

Joe Cavaretta | Sun Sentinel | Getty Images

Spirit Airlines CEO Ted Christie on Thursday laid naked the explanations his firm rejected JetBlue Airways’ $3.6 billion supply to purchase the ultra-low-cost service, and went as far as to recommend that the bid could have been meant to cease Spirit’s deliberate merger with Frontier Airlines.

“JetBlue shareholders aren’t supportive of this deal, either, based on the company’s stock performance. However, despite clear concern from JetBlue shareholders, JetBlue has continued to pursue disruption to the Spirit-Frontier combination,” Christie mentioned throughout Spirit’s first-quarter earnings name.

“I have wondered whether blocking our deal with Frontier is in fact their goal,” Christie added.

JetBlue didn’t instantly reply to CNBC’s request for touch upon Christie’s remarks.

In February, Spirit and Frontier introduced plans to merge in what would create an enormous low cost airline, the fifth-largest service within the U.S. JetBlue’s unsolicited bid for Spirit initially threw that tie-up into query. But on Monday, Spirit rejected JetBlue’s supply in favor of the Frontier deal, citing issues {that a} JetBlue buyout would not clear regulatory hurdles.

JetBlue has a partnership with American Airlines in what’s often known as the Northeast Alliance (NEA) to raised compete in opposition to the likes of United Airlines and Delta Air Lines at main airports. JetBlue contends that buying Spirit would assist it additional compete.

Christie on Thursday emphasised that the Department of Justice is already suing to dam the JetBlue-American partnership, whereas highlighting that “half the expected synergies” of JetBlue absorbing Spirit “would come from reduced capacity and increased fares to consumers.”

“You don’t need to be an antitrust attorney to see the issues here,” Christie mentioned. “It stretches any sort of common sense to believe that an acquisition of Spirit by JetBlue would be approved by the DOJ while it is suing to block the NEA.”

Spirit mentioned it submitted a counter supply to JetBlue – together with abandoning the NEA with American – however JetBlue rejected the choice proposal.

JetBlue CEO Robin Hayes wrote in a letter to Spirit’s CEO and its chairman on April 29 that its supply stands a greater likelihood of clearing regulators than the Frontier merger.

“We firmly believe that it is in the best interest of your stockholders for you to accept our Proposal, which has significantly greater odds of achieving regulatory clearance given the stronger regulatory commitment on our part compared to Frontier,” Hayes wrote then.

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