News February 07, 2022
Frontier and Spirit Airlines to Merge!
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Two ultra-low-cost airline carriers are joining forces to create one super company!
In a press release issued Monday, Frontier Airlines and Spirit Airlines are merging together to create America’s “most competitive ultra-low fare airline”!
Per CNBC, the boards of both companies approved the deal — valued at $6.6 billion — over the weekend. Once merged, the joint venture will become the nation’s fifth-largest airline.
“We are thrilled to join forces with Frontier to further democratize air travel,” said Ted Christie, president and CEO of Spirit. “This transaction is centered around creating an aggressive ultra-low fare competitor to serve our Guests even better, expand career opportunities for our Team Members and increase competitive pressure, resulting in more consumer-friendly fares for the flying public. We look forward to uniting our talented teams to shake up the airline industry while also continuing our commitment to excellent Guest service.”
“Together, Frontier and Spirit will be America’s Greenest Airline and deliver more ultralow fares to more people in more places,” added Barry Biffle, Frontier’s president and CEO.
CNBC adds that Frontier has a 51.5 percent controlling stake in the combined airline, while Spirit investors will receive 1.9126 shares of Frontier plus $2.13 in cash for each share they own, giving Spirit shareholders an implied value of $25.83 per share. This is a 19 percent premium over the value of Spirit shares at the end of last week.
As part of the deal, the merger aims to deliver $1 billion in annual consumer savings, offer more than 1,000 daily flights to over 145 destinations in 19 countries, expand with more than 350 aircraft, increase access to lower fares by adding new routes to underserved communities across the United States, Latin America, and the Caribbean, streamline operational efficiency, and expand frequent flyer and membership offerings.
Additionally, the companies say the deal is expected to add 10,000 direct jobs and thousands of additional jobs at the companies’ business partners by 2026.
As of now, Frontier and Spirit did not announce a new name for the combined airline, or who the CEO of the company will be.
However, these questions are expected to be answered by a committee when the transaction closes sometime later this year.
