JetBlue Abandons Spirit Airlines Merger After Regulatory Hurdles Prove Too Much

The JetBlue-Spirit Airlines deal, which had been in the works for close to two full years, is officially dead.

JetBlue announced on Monday that it had reached an agreement with Spirit to terminate the deal, which was struck in July 2022. JetBlue will pay a $69 million breakup fee, and Spirit will continue to operate as an independent ultra-low-cost airline.

In Monday’s announcement, JetBlue CEO Joanna Geraghty, who was named CEO just this year, said that JetBlue is still proud of the work it did to try to close the deal, but its hurdles, mostly regulatory issues, were too difficult to overcome.

“We believed this merger was worth pursuing because it would have unleashed a national low-fare, high-value competitor to the Big Four airlines,” Geraghty said. “We are proud of the work we did with Spirit to lay out a vision to challenge the status quo, but given the hurdles to closing that remain, we decided together that both airlines’ interests are better served by moving forward independently.”

JetBlue originally won the rights to buy Spirit after the Frontier-Spirit deal fell through in 2022. The Frontier deal fell through after Spirit could not secure shareholder approval for the deal. JetBlue had swooped in shortly after.

The JetBlue-Spirit deal would have created the fifth-largest airline in the U.S. While there was optimism that the deal could be approved, particularly after JetBlue decided against appealing the Northeast Alliance dissolution with American, the legal and regulatory approvals needed were not likely to be met by the July 24, 2024 deadline and a federal judge officially blocked the deal in January.