Frontier Airlines has once again proposed merging with Spirit Airlines, which is currently navigating bankruptcy.
The two budget carriers initially planned to merge in 2022, but a competing offer from JetBlue Airways disrupted the deal. JetBlue’s acquisition attempt was later blocked by a federal judge, leading Spirit to file for bankruptcy protection in November.
Frontier said it has engaged with Spirit’s board and executives this month, asserting its proposal is stronger than Spirit’s plan to exit bankruptcy. In an email to Spirit executives, Frontier Chairman Bill Franke and CEO Barry Biffle warned that Spirit’s standalone plan would leave it “highly levered” and “losing money,” emphasizing urgency for the merger.
However, Spirit’s leadership swiftly rejected the offer, calling the terms “inadequate and unactionable” in a letter filed with the SEC on Wednesday. The airline expects to emerge from Chapter 11 this quarter, having cut costs, reduced 200 jobs, and sold Airbus planes. Spirit also faced operational hurdles from a Pratt & Whitney engine recall that grounded many of its jets.
Budget airlines like Frontier and Spirit have struggled post-pandemic as rising costs and shifting consumer preferences have impacted profitability. Both airlines have been adjusting their business models, eliminating cancellation and change fees and introducing bundled perks and premium seating options.
Despite Spirit’s rejection, Frontier’s renewed push signals ongoing interest in consolidation as both airlines work to stay competitive in a changing industry.
