Spirit Airlines Rejects Frontier Airlines’ Revised Acquisition Offer, Focuses on Bankruptcy

Spirit Airlines isn’t interested in Frontier Airlines’ latest acquisition offer — the beleaguered airline rejected it so it could focus on its bankruptcy proceedings.

According to Reuters, the takeover offer, valued at approximately $2.16 billion, was rejected because it was less beneficial to shareholders than the company’s current reorganization plan.

Frontier’s new offer reiterated its plan from earlier this month, in which Spirit Airlines’ stockholders would receive $400 million in debt and a 19% ownership stake in Frontier.

However, it waived the requirement that Spirit conduct a $350 million stock rights offering and utilize the money to retire its debtor-in-possession facility. It also asked that the bankruptcy court-approved termination charge of $35 million be waived.

Spirit Airlines, which filed for bankruptcy protection last year and intends to finish its restructuring in the first quarter, said the amended proposal did not address certain material risks and issues it had previously raised.

Instead, the Florida-based airline countered the proposal with a deal that would give Spirit stockholders $600 million in debt and $1.185 billion in equity — an offer that Frontier rejected.

“We remain convinced that the combination of Spirit and Frontier would have created more value than Spirit’s standalone plan,” Frontier said in a statement.

Spirit Airlines and Frontier Airlines Have Been Going Back and Forth for a While

Spirit Airlines began investigating the possibility of merging with rival ultra-low-cost carrier Frontier Airlines just a few months after the Department of Justice stopped JetBlue’s almost $4 billion acquisition of the bargain airline in March 2024.

But that wasn’t the first time the two firms met to discuss the prospect of a merger: Spirit and Frontier originally discussed purchase in February 2022, but JetBlue beat Frontier to the punch with its far larger financial resources.

Despite similar operational strategies, Spirit Airlines and Frontier Airlines service slightly different markets. Spirit has long thrived as a leisure airline, connecting cities in the eastern and midwestern United States with sunny vacation destinations in the American South, Mexico, and the Caribbean. Although the airline’s route network has evolved, vestiges of the original model may still be found in the airline’s present operational base network.