Feb. 12 (UPI) — Spirit Airlines Tuesday rejected Frontier’s most recent merger proposal, opting to proceed with its own standalone recapitalization without a merger instead.
Spirit Airlines said in a statement that Frontier’s latest merger offer failed to address material risks and other issues.
“The new proposal would deliver less in value to the Company’s stakeholders than contemplated by the Company’s existing plan of reorganization, is uncertain as to timing and completion, would result in extended and materially more costly and uncertain chapter 11 proceedings, and has uncertainties with regard to needed regulatory and court approvals,” Spirit said.
A hearing to consider Spirit’s reorganization plan is set for Thursday. Spirit said “approximately 99.9%” of voting creditors have approved its reorganization plan, which the company plans to complete during the first quarter of this year.
Frontier announced its newest merger bid Jan. 29. The airlines have pursued a merger deal since 2022.
Bill Franke, chair of Frontier’s board of directors, said in a January statement that its proposal would provide more value than Spirit’s standalone plan to emerge from bankruptcy.
While Spirit and Frontier were in merger talks, JetBlue struck a deal with Spirit instead. But it was blocked by a federal judge in 2024.
Spirit said Tuesday its management and Board of Directors carefully reviewed Frontier’s proposal, but found it lacking.
“Spirit will continue swiftly to advance and conclude its restructuring process, which will significantly deleverage the Company and position it for long-term success,” the company’s Tuesday statement said.