Spirit Airlines shares extend rebound after it appeals ruling blocking JetBlue merger
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Spirit and JetBlue planes at Fort Lauderdale-Hollywood International Airport (FLL) in Fort Lauderdale, Florida, US, on Wednesday, Nov. 1, 2023.
Eva Marie Uzcategui | Bloomberg | Getty Images
Spirit Airlines shares jumped about 10% on Monday after the budget carrier and JetBlue said after the market closed Friday that they would appeal a federal judge’s ruling blocking the airlines’ planned merger on antitrust grounds.
“Our merger agreement with Spirit remains in effect and we still have obligations under the agreement. … This is a standard procedure, required under the merger agreement,” JetBlue General Counsel Brandon Nelson said in a note to staff Friday.
JetBlue agreed to buy Spirit for $3.8 billion in a 2022 deal that would have created the country’s fifth-largest airline. U.S. District Court Judge William Young last week blocked that combination, citing reduced competition.
“JetBlue plans to convert Spirit’s planes to the JetBlue layout and charge JetBlue’s higher average fares to its customers,” Young wrote in his Jan. 16 decision. “The elimination of Spirit would harm cost-conscious travelers who rely on Spirit’s low fares.”
Spirit shares are down about 50% since that ruling. The stock had dropped more than 60% after the ruling but has rebounded slightly following the appeal and after Spirit raised raised its financial forecast for the fourth quarter of 2023. The carrier also said it is looking to refinance its debt.
JetBlue shares rose about 1% on Monday and have climbed more than 3% since its merger with Sprit was blocked. Shares of Delta, American and Southwest each gained less than 1%.
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