Frontier Airlines is making another offer to merge with bankrupt Spirit Airlines, less than two years after a previous plan fell through.
Frontier said in a statement Wednesday that the transaction “would provide meaningful value to Spirit financial stakeholders” and create a “stronger low-cost carrier” that would rescue Spirit from bankruptcy.
Spirit has already rejected the latest offer, revealing in a letter sent to Frontier in a regulatory filing that it’s “far short” of what its shareholders would expect and is less money than the previous offer. The airline said it’s not commenting beyond that.
The latest proposal, funded by newly issued Frontier debt and common stock, “reflects a compelling opportunity that will result in more value than Spirit’s standalone plan by creating a stronger low fare airline with the long-term viability to compete more effectively and enter new markets at scale,” said Bill Franke, chair of Frontier’s board of directors.
The two airlines originally intended to merge in 2022, but JetBlue offered Spirit more money and the deal was scrapped. However, a federal judge blocked Spirit’s merger with JetBlue last year.
In November 2024, Spirit filed for bankruptcy, and it recently slashed 200 jobs. A spokesperson previously told CNN that the job cuts are meant to reduce costs and are separate from the Chapter 11 filing.
Related article Frontier Airlines introducing ‘first class-style’ seats
Frontier (ULCC) executives once said that a deal for Spirit would create the nation’s fifth-largest airline but be smaller than many airline mergers of recent decades. A combination of the two carriers would have brought together similar brand propositions of charging very low base fares, while charging passengers extra for most things, including carry-on bags.
Both airlines have announced upgrades in recent months, trying to capture some passengers from the big three airlines, which are experiencing financial success.
Frontier is adding “first-class style” seats later this year and Spirit rolled out premium “Go Big” bundles, letting passengers to pay extra for tickets that include items such as snacks, drinks and free bags and priority check-in along with its wider seats.