INDIANAPOLIS (AP) — Republic Airways has agreed to sell Frontier Airlines to an investment firm led by former Spirit Airlines Chairman William Franke for $36 million.
The companies put the deal's total value at about $145 million including assumed debt.
Last month Republic Airways said that it was extending exclusive talks with a potential buyer of Frontier for two weeks, until Sept. 30. Republic did not publicly identify the bidder, but at the time numerous published reports said that it was Franke's Indigo Partners LLC.
Republic, which runs regional-airline service for large carriers such as United and Delta, announced in July that it had reached an exclusive but nonbinding agreement with a potential buyer for Frontier, which it bought out of bankruptcy.
Indigo Partners said Tuesday that it plans to invest more money directly into Frontier Airlines Holdings Inc. after the buyout closes.
"I am confident that Frontier will enjoy future growth as Indigo continues the process to position the airline as a leading ultra-low-cost carrier in the United States," Republic Chairman, President and CEO Bryan Bedford said in a statement.
Republic said that as part of the deal, but under a separate agreement, it will assign to Frontier all of its rights under agreements related to Republic's Airbus A32oneo order in exchange for reimbursement of pre-delivery deposits that total $32 million.
The acquisition is contingent on agreements being reached with the Association of Flight Attendants and FAPAInvest LLC no later than Oct. 31. It also is conditioned on other third-party commercial agreements, the receipt of some third-party consents and approval from the Federal Communications Commission for the transfer of Frontier's radio licenses.
The deal, approved by Republic's board, is expected to close in December if the appropriate conditions are met.
Republic Airways Holdings Inc. is based in Indianapolis. Frontier is based in Denver.