Spirit Delays Vote on Potential Frontier Merger to June 30

Spirit shareholders won’t get their say on the potential merger with Frontier Airlines until at least June 30.

Spirit on Wednesday morning filed with the Securities and Exchange Commission (SEC) to postpone its June 10 special meeting until June 30. Spirit said it was delaying the vote “to allow the Spirit Board of Directors to continue discussions with Spirit stockholders, Frontier Group Holdings, and JetBlue Airways Corporation.”

The airline will now keep voting open for all those who were Spirit stockholders as of May 6, 2022, until that special meeting. It continues to encourage its stockholders to vote electronically on the future of the airline. Voting will be closed at the end of the day on June 29.

Spirit’s Board of Directors has long affirmed that it preferred the Frontier deal, largely because of expected regulatory issues that could happen with JetBlue. The Board said that despite JetBlue offering a deal that it says is a 51% premium to Frontier’s offer as of June 3 and about a 52% premium to Spirit’s share price.

JetBlue most recently sweetened that deal, adding a $350 million reverse break-up fee, an increase of $150 million compared to its previous offer, and an increase of $100 million compared to Frontier’s offer. It also included a prepayment of $1.50 per share of that reverse breakup fee, which, when added to the previous $30 per share offer, made the deal worth an aggregate of $31.50.

JetBlue CEO Robin Hayes recently went on record about those regulatory concerns, explaining that both deals offer similar regulatory issues, making JetBlue’s higher-valued offer, and larger break-up fee, the better choice.

“This offer reflects the seriousness of our commitment and underscores our confidence in completing this transaction. Additionally, given the similar regulatory risks of the two transactions and the increased reverse break-up fee we are prepared to provide, we believe our Improved Proposal remains a Superior Proposal by any measure,” Hayes wrote.

“Our Improved Proposal represents a compelling opportunity for your stockholders to receive a significant premium in cash, with greater value and certainty, and a higher reverse break-up fee than the inferior transaction with Frontier,” Hayes added.