July 28, 2022
Washington – Following last night’s unexpected withdrawal of Spirit Airlines from the proposed merger with Frontier, JetBlue has wasted no time in solidifying its position in relation to the low-cost carrier.
Announced today, New York’s Hometown Airline has confirmed it will merge with Spirit to create the fifth-largest airline in the United States.
The boards of directors of both airlines have approved a definitive merger agreement which will see JetBlue acquire Spirit for $33.50 per share in cash.
This includes a prepayment of $2.50 per share once the Spirit stockholders approve the transaction. Altogether, the deal will see Spirit bought out for a grand total of $3.8 billion.
If the partnership goes ahead, JetBlue has said it will bring its experience to all aircraft, indicating that it plans to refit every one of Spirits airplanes with the typical JetBlue fare.
Robin Hayes, chief executive officer at JetBlue said,
“We are excited to deliver this compelling combination that turbocharges our strategic growth, enabling JetBlue to bring our unique blend of low fares and exceptional service to more customers, on more routes.
JetBlue says that the merger will boost the value of the newly combined entity to $7.6 billion, accounting for an adjusted debt of $3.8 billion and operating leases of $2 billion.
Most importantly, it will create an airline with a total fleet size of 458 airplanes, overtaking the likes of Turkish Airlines and Air China to become the world’s 8th largest carrier by fleet size.
In the United States, it will put the new JetBlue-Spirit in fifth place of the largest mainline carriers.
American, Delta, United, and Southwest remain larger, and in the regional market, SkyWest does also fly more planes.
But for the two airlines, the new scale of operations possible through this merger will put them in a very strong position for the future.
In particular, the acquisition will give JetBlue a new, strong presence in key leisure markets, including Fort Lauderdale, Orlando, San Juan, and Los Angeles.
It will also increase its position in some of the key hubs of the ‘big four’ airlines, including Dallas, Las Vegas, Atlanta, and Chicago.
© CopyRights RawNews1st
