Why Spirit Airlines Stock Is Flying High Today
Spirit Airlines (NYSE: SAVE) wasted little time in rebooking after cancelling its planned merger with Frontier Holdings Group. Less than 24 hours after Spirit terminated the Frontier deal, it has agreed to be acquired by JetBlue Airways (NASDAQ: JBLU), causing Spirit shares to jump 5% higher on Thursday.
Spirit and Frontier first announced plans to merge back in February, but JetBlue set its sights on the airline soon after and launched a hostile offer to try to break up the Spirit/Frontier deal. On Wednesday, Spirit and Frontier terminated their agreement after failing to win Spirit shareholder support. On Thursday, JetBlue swept in.
JetBlue agreed to pay $33.50 per share for Spirit, valuing the airline at $7.6 billion including debt. The deal terms include a $2.50 per-share payment to Spirit holders as soon as shareholders sign off on the deal, and a monthly per-share payment starting in January if JetBlue is unable to quickly win regulatory approval.
Source Fool.com
