(Boursier.com) — Unsurprisingly, the potential fifth largest American company will not see the light of day. One month after the opposition of the American justice system to the proposed rapprochement between JetBlue And Spirit Airlines, the two carriers decided to throw in the towel. The two groups reached an agreement to terminate their project after determining that the terms of the agreement, including “obtaining necessary legal and regulatory approvals, were unlikely to be met” within the specified time frame. in the agreement.
JetBlue, which also faces pressure from activist investor Carl Icahn to return to sustainable growth, will pay Spirit $69 million in compensation. “We have concluded that current regulatory hurdles will not allow us to close this transaction within the time frame provided for in the merger agreement,” said Ted Christie, CEO of Spirit.
According to the American Justice Department, the $3.8 billion operation would have harmed competition by eliminating the country’s main discount airline and leading to higher prices throughout the sector. “If JetBlue were allowed to gobble up Spirit – at least as proposed – it would eliminate one of the airline industry’s few major competitors that offers unique innovation and pricing discipline,” Judge William G. Young said on June 16. last January. “Worse, the merger would likely cause JetBlue to further abandon its roots as a maverick low-cost carrier.”
Spirit Airlines plunges more than 15% on Wall Street after the end of negotiations with JetBlue was made official.
©2024 Boursier.com