The ongoing bidding war for Spirit Airlines Inc. (Spirit) between Frontier Group Holdings Inc (Frontier) and JetBlue Airways seems to be drawing to a close as Frontier has announced that it will not be increasing its offer of US$4.13 per share and 1.9126 Frontier shares in its cash and stock offer. In addition, if the offer is accepted, Frontier will prepay US$2.22 per share as a cash dividend to stockholders, while increasing its reverse termination fee to US$350 million.
In a letter to Spirit, Frontier Chief Executive Barry Biffle said the Florida-based ultra-low-cost carrier should consider last month’s revised merger agreement as its “last, best and final offer.” Based on last Friday’s trading figures, the cash and stock offer from Frontier was valued at US$24.69 per share.
It is understood that Spirit shareholders are more in favour of the deal with JetBlue, though there have been concerns that the deal may fall foul of antitrust scrutiny, though the deal with Frontier could suffer the same fate. Whichever ultra-low-cost carrier is successful, the result will be the creation of America’s fifth-largest airline. Spirit shareholders are due to vote this Friday on their preferred deal.