JetBlue Goes Hostile for Spirit

The stock market has started the week on a down note but it’s not too severe. In fact, I think there’s a good chance the market will be positive before the closing bell.

Many retailers are set to report their earnings this week. Home Depot and Walmart report tomorrow.

One interesting story is that JetBlue Airways has launched a hostile takeover bid of Spirit Airlines. They had offered $33 per share but Spirit turned it down in order to merge with Frontier Airlines.

JetBlue has said acquiring Spirit would give it access to a large fleet of Airbus planes, trained pilots and the ability to better compete against the “Big Four” U.S. airlines that control most of the U.S. market. Spirit rejected the offer to stick with a planned $2.9 billion-cash-and-stock deal to merge with fellow discounter Frontier Airlines. Those two airlines say a merger would allow them to grow and compete more easily.

JetBlue on Monday offered Spirit shareholders $30 a share and encouraged them to vote against the Frontier deal during a June 10 shareholder meeting. The company also said its earlier offer of $33 per share is still on the table if Spirit decides to negotiate. Spirit’s shares closed Friday at $16.98.

Lloyd Blankfein, the former CEO of Goldman Sachs, said there’s a ‘very, very high risk’ of recession.

Posted by on May 16th, 2022 at 10:47 am


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