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Weeks later, JetBlue made an unsolicited bid for Spirit. But Spirit’s executives questioned JetBlue’s intentions, suggesting that the offer may have been intended only to spoil the combination with Frontier. Spirit also said antitrust regulators would probably stand in the way of a JetBlue merger, though experts said either deal would be subject to intense federal scrutiny.
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Wednesday’s news doesn’t mean that JetBlue’s offer will be accepted, but it could bode well for Spirit in their negotiations.
“Today’s termination simplifies the path towards a potential JetBlue-Spirit merger, though doesn’t ensure such an outcome,” Jamie Baker and James Kirby, airline analysts at J.P. Morgan, said in a research note. “That said, we are of the ‘no news is good news’ view, as it suggests Spirit continues to hone its negotiating efforts rather than just roll and accept JetBlue’s last, public offer.”
It isn’t clear whether a majority of Spirit’s shareholders would support a JetBlue acquisition. And even if they did, regulators could derail the combination or demand stiff concessions from the companies like demanding that they give up flights or airport gates in places where they have significant overlap.
The Justice Department is already suing JetBlue and American Airlines to prevent a partnership between those airlines at airports in Boston and New York, with a trial scheduled for early this fall.
Acquiring Spirit would accelerate JetBlue’s expansion plans and create the nation’s fifth-largest airline. Together, the airlines would control about 10.2 percent of the market, still behind the nation’s four dominant carriers. United, the fourth-largest airline, has a 13.9 percent market share.