Frontier Airlines to Buy Spirit in $6.6 Billion Cash-Stock Deal
Photo Credit: Spirit Airlines and Frontier Airlines plan to merge. Denver International Airport
Skift Take
The rumors have come true with Spirit Airlines and Frontier Airlines unveiling plans to merge Monday. The deal would create a U.S. budget juggernaut and the country's fifth largest airline but likely faces a tough approvals process from the pro-competition Biden administration.
Frontier Airlines and Spirit Airlines have unveiled plans to merge in a deal that would create the fifth largest carrier in the U.S. and a budget juggernaut to be reckoned with.
Under terms unveiled on Monday, the cash and stock deal would create an airline serving more than 145 destinations in 19 countries with more than 280 aircraft. Frontier — the dominant partner in the deal — shareholders would own 51.5 percent of the resulting company despite Spirit being the larger airline. The merger has been approved by the boards of both carriers, but is subject to the approval of a Biden administration increasingly wary of consolidation. The airlines hope to close the transaction in the second half of 2022.
The transaction is valued at $6.6 billion, including the $2.9 billion equity value of Spirit as well as net debt and operating lease liabilities. Spirit shareholders would receive 1.9126 shares of Frontier plus $2.13 in cash for each of their shares.
