Low cost airlines Spirit and Frontier Airlines merge: it will be the fifth largest airline in the United States
NEW YORK.- US low-cost airlines Spirit Airlines and Frontier Airlines announced their merger on Monday. following a stock-and-cash deal valued at $6.6 billion, in what will become the nation’s fifth-largest airline.
The firms indicated that the transaction would offer more low-cost routes to destinations in the United States, Latin America and the Caribbean.
”This transaction seeks to create a competitive group offering ultra-low prices to serve our customers even better, diversify the career opportunities of our team members, and increase competitive pressure with more favorable fares for the public,” Spirit Airlines CEO Ted Christie said in a statement.
The deal –still pending approval by US antitrust authorities– must be settled before the end of the first half of 2022 and stipulates that Frontier Arilines will control 51.5% of the new entity and Spirit 48.5%.
Spirit shareholders will receive 1.9126 Frontier shares, plus $2.13 in cash for each Spirit share they own, up 19% from $25.83 at Friday’s close.
William Franke, Chairman of the board of directors of Frontier, will hold the same position in the new company, whose name was not specified. The identity of its executive director and where the headquarters will be located were also not disclosed.
Both firms, which fly only Airbus aircraft, they expect to create 10,000 jobs by 2026.
AFP and AP Agencies