Pressured by high debt, ultra-low-cost airlines Frontier and Spirit Airlines have resumed talks about a possible merger, but again they have not reached an agreement.
In a regulatory filing filed with the U.S. Stock Exchange, Spirit said it had rejected a proposal from Frontier Airlines that involved paying $400 million plus 19% of its equity to its shareholders.
Instead, Spirit expects to emerge from Chapter 11 in March and seek a financial restructuring on its own two feet.
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The potential merger could create the 5th largest airline in the U.S., behind only United, American, Delta and Southwest and just above Alaska/Hawaiian.
Together, the two carriers would have about 100 million passengers per year and a fleet of more than 400 aircraft.
But Spirit considered that the merger of the businesses would imply more investments and lengthy regulatory approvals.
Frontier and Spirit had announced a preliminary merger agreement in 2022, but it was ‘run over’ by JetBlue, which made a better offer for the Florida-based airline.
However, the merger was blocked by the US courts, which considered the agreement harmful to the competitiveness of the country’s air travel market.
