It will have 77 million customers and will hold 9% of the US market share, according to figures provided by both companies.
AFP, United States
US low-cost airline JetBlue reached an agreement on Thursday to acquire its competitor Spirit for $3.8 billion.
The announcement of the purchase, which still needs to be approved by regulators and shareholders, comes a day after Frontier, another airline, abandoned a merger project with Spirit.
If finalized, the new group will become the fifth largest airline in the United States in terms of seats offered, behind the "Big Four" of American, United, Delta, and Southwest.
It will have 77 million customers and will hold 9% of the US market share, according to figures provided by both companies.
"Spirit and JetBlue will continue to advance our shared goal of transforming the industry to lower fares for the Big Four airlines," JetBlue CEO Robin Hayes said in a statement.
Spirit and Frontier had announced their intention to get closer in February.
But a few weeks later, JetBlue surprised everyone by presenting a better financial offer to Spirit's shareholders.
After Spirit's board of directors rejected the offer, JetBlue launched a hostile takeover bid in May.
Spirit executives had repeatedly expressed their preference for a deal with Frontier, saying that antitrust authorities would likely be reluctant to approve a partnership with JetBlue. But they failed to convince shareholders.
An extraordinary general meeting to approve the merger with Frontier was postponed four times and the operation was finally cancelled.
In the agreement announced this Thursday, Jetblue is offering to pay in cash for Spirit's shares, at a unit price of $33.50, 38% higher than the closing price of the stock on Wednesday.
Both companies expect to complete the transaction before the end of the first half of 2024.
Spirit shares rose slightly more than 4% to $25.29 in electronic trading before the opening of Wall Street on Thursday.
JetBlue shares gained 0.83% to $8.46.
