Frontier offers $250 million reverse breakup fee to Spirit if regulators reject merger
Frontier Airlines’ parent company (NASDAQ: ULCC) said on Thursday it would pay a reverse breakup fee of $250 million to Spirit Airlines Inc (NYSE: SAVE) if the regulators do not approve the deal
• Frontier is trying to convince the investors to approve the deal
Frontier Airlines’ parent company (NASDAQ: ULCC) said on Thursday it would pay a reverse breakup fee of $250 million to Spirit Airlines Inc (NYSE: SAVE) if the regulators do not approve the deal.
This comes as an attempt from Frontier to convince investors to approve the deal rather than accepting offer of rival JetBlue Airways Corp (NASDAQ: JBLU).
“The combination of a higher reverse termination fee and a much greater likelihood to close in a Frontier merger provides substantially more regulatory protection for Spirit stockholders than the transaction proposed by JetBlue,” said Mac Gardner, Spirit’s chairman said.
JetBlue, which had offered a $3.6 billion cash takeover bid to Spirit, is battling with Frontier Group for the takeover of Spirit. In February, Spirit had signed a $2.9 billion merger deal with Frontier.
Spirit had earlier rejected JetBlue’s offer saying there was too much risk with the deal as regulators might bar a merger with JetBlue.
Picture Credits: Getty Images
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