2 Big Reasons Why JetBlue Wants to Buy Spirit Airlines
Two months ago, Spirit Airlines (NYSE: SAVE) and Frontier Group announced merger plans. By combining to create a budget airline giant, the two companies hoped to gain scale and reduce their costs, thereby improving their profitability and bolstering their growth potential.
Now, JetBlue Airways (NASDAQ: JBLU) has thrown a wrench in their plans. Last Tuesday, JetBlue shocked the aviation world by offering to buy Spirit Airlines for $33 per share, easily topping Frontier's bid. Let's look at why JetBlue is so eager to swallow up the nation's largest ultra-low-cost carrier.
At first glance, JetBlue Airways and Spirit Airlines seem like a very strange match. JetBlue has historically tried to carve out a niche for itself by offering more amenities than rivals while keeping fares affordable. For example, it boasts the most legroom in coach of any U.S. airline (on average), free high-speed Wi-Fi, free satellite TV and satellite radio, and unlimited free snacks.
Source Fool.com
