Spirit Delays Stockholder Meeting on Frontier Merger
Carrier will allow continuing discussions with JetBlue, Frontier and shareholders >>
by: Harvey Chipkin
Spirit Airlines announced that it had postponed its special meeting of stockholders relating to the proposed merger agreement with Frontier Group Holdings (parent of Frontier Airlines) until June 30. According to the announcement, the meeting was postponed to allow Spirit’s board of directors to continue discussions with Spirit stockholders, Frontier and JetBlue Airways. JetBlue has made a counteroffer to purchase Spirt. Spirit remains bound by the terms of the merger agreement with Frontier, said the announcement, and Spirit’s board has not determined that either JetBlue’s unsolicited tender offer or its updated proposal received on June 6 constitutes a “superior proposal” as defined in the merger agreement with Frontier and has made no change to its recommendation that Spirit stockholders adopt the merger agreement with Frontier. The delay was announced days after JetBlue made its most recent purchase offer for Spirit of $31.50 per share, including a $1.50-per-share upfront payment as well as a $350 million reverse breakup penalty if a Spirit-JetBlue merger were to be blocked by antitrust regulators at the Justice Department. Under the existing Frontier-Spirit offer, Frontier is slated to pay each Spirit investor 1.9126 shares of Frontier stock plus $2.13 in cash for each Spirit share they own. Frontier has also offered to pay $250 million to Spirit in the case of regulatory denial.
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