Spirit Airlines postpones final decision on Frontier merger until July 15

For the third time, Broward County’s Spirit Airlines has delayed a final decision on whether to go ahead with a planned merger with rival discount carrier Frontier Airlines, as company directors keep negotiating with Frontier and hostile bidder JetBlue Airways.

On Thursday night, less than 24 hours before Spirit’s shareholders were supposed to vote Friday on the proposed combination with Frontier, Spirit said it postponed the special meeting of shareholders to vote on the deal until July 15.

Miramar-based Spirit, which employs 3,400 workers in South Florida, agreed in February to merge with Denver-based Frontier in cash-and-stock transaction now valued at roughly $2.4 billion.

JetBlue launched a hostile cash takeover bid in April, and since then boosted it to $3.64 billion or $33.50 for each share of Spirit’s stock, a significant premium over Frontier’s offer.

Spirit said in a prepared statement Thursday it was again delaying the shareholders’ tally so the airline’s board of directors can continue discussions with Frontier and New York-based JetBlue Airways. The vote originally was set for June 10, before Spirit had delayed it until June 30, then to July 8 and now to next Friday.

JetBlue CEO Robin Hayes said he was encouraged by recent talks with Spirit officials “and are hopeful they now recognize that Spirit shareholders have indicated their clear, overwhelming preference for an agreement with JetBlue.”

On Thursday, Frontier declined to comment.

Spirit, which has been urging its shareholders to support the merger with Frontier, commands the top spot for its share of the airline passenger market at Fort Lauderdale-Hollywood International Airport. At Miami International Airport, Spirit is the distant No. 2 carrier behind American Airlines.

Combining the two discount airlines would create the fifth-largest U.S. airline, trailing the big legacy carriers American Airlines, Southwest, Delta and United.

Spirit CEO Ted Christie, the company’s board of directors, as well as airline industry analysts, have said federal regulators likely would not ever give final clearance for JetBlue to acquire Spirit, due to anti-competitive concerns and fears that such a deal would lead to higher customer airfares.

Realizing those concerns, JetBlue is offering Spirit a $400 million breakup fee should Spirit accept its bid and regulators not approve it.

Earlier this month, Christie told the New York Times in his view it’ll be a merger with Frontier or continue flying solo.

“If our shareholders don’t approve the Frontier deal, we’re back to a standalone,” Christie said. “We have made clear the issues that we have with the JetBlue transaction.”