🎧 Listen: In today's episode of The Journal podcast, alyrose reports how JetBlue’s competing bid against Frontier Airlines for budget airliner Spirit has created a messy, public fight—and how the possible mergers will shake up flying in the U.S.
This transcript was prepared by a transcription service. This version may not be in its final form and may be updated.Alison Sider: Yeah. It is a bit of a love triangle. At the center of it is Spirit Airlines, the ultra cost carrier, budget airline, frequent butt of late night jokes, flies the big yellow planes.
Alison Sider: JetBlue swoop in with its own offer. And it's much higher than the Frontier offer. And JetBlue just made it clear, like we want to buy Spirit. Alison Sider: It felt like corporate destiny. It's something that had been rumored for a long time. And the companies have disclosed now that they'd talked on and off for a couple of years about it. And it's something that I think people, if you'd asked people at the start of the year, are there going to be any airline mergers this year? They might've said, well, Spirit and Frontier.
Alison Sider: Right. I mean, so JetBlue's plan for Spirit, if it's able to acquire it is basically to erase Spirit. Everything Spirit about Spirit is going to go away. They're going to repaint the planes. They're going to take seats out. So it'll be just more JetBlue, a bigger JetBlue. And that's really what they're after. They're after scale and growth.
Alison Sider: Spirit's reaction was like, I don't see how you can get a deal past antitrust regulators in the Biden administration, which is already signaled it's going to be pretty aggressive in its approach to corporate mergers. It makes no sense. So like, we can't really even think about how much money you're offering us because we just think there's such a low likelihood of this deal getting done.
Alison Sider: You should reject the Frontier deal when the shareholder vote comes up. And if you want to send a message to your board, you should sell us JetBlue, your shares for $30 each to show your board how much you want them to negotiate with JetBlue.Alison Sider: I mean, Spirit has stuck to its guns and it has been faithful this whole time to Frontier. Every time they say, they'll look at the offer, they'll look at it. But they've said they think JetBlue is wrong.
Ted Christie : JetBlue has continued to pursue disruption to the Spirit, Frontier combination. I have wondered whether blocking our deal with Frontier is in fact, their goal.