Spirit Airlines continues to provide information about its proposed acquisition by Frontier Airlines to the US Department of Justice (DOJ) – although Spirit has said a competing acquisition offer from JetBlue Airways may be superior.
On April 13, Spirit, based in Miramar, Fla., received a request from the DOJ for more information about the Spirit-Frontier combination, Spirit said on April 14. Frontier says it received a similar request from the government.
“Spirit remains bound by the terms of the merger agreement with Frontier and will continue to voluntarily provide information to the DOJ to facilitate its review of the proposed transaction,” Spirit said in a regulatory filing.
Denver-based Frontier made an offer Feb. 7 to buy Spirit with cash and stock that, at the time, was worth about $2.9 billion. The agreement provides that Frontier will compensate Spirit shareholders $2.13 and 1.9 Frontier shares for each Spirit share.
Then, on April 6, New York-based JetBlue launched a competing cash offer to buy Spirit. JetBlue has offered to buy all Spirit shares at $33 each, which equates to a purchase price of $3.6 billion.
Spirit said it was considering both offers, but also called JetBlue’s offer a “superior proposition.”
But Spirit’s decision could come down to more than money. Another likely factor at play is the opinion of the DOJ, which will review both deals for possible antitrust violations. The DOJ is already fighting JetBlue in court, after suing the carrier and its partner American Airlines to stop these airlines from implementing a broad partnership in the northeastern United States.
In an April 14 regulatory filing, Frontier says it and Spirit have “over the past few weeks…voluntarily provided information to the DOJ to facilitate its review of the proposed transaction, and will continue to do so over the coming months.” month”.
“We look forward to demonstrating the consumer benefits inherent in the Frontier and Spirit combination at a time when JetBlue has made a proposal that would reduce competition and result in more expensive travel for consumers,” Frontier’s filing adds.