U.S. markets close in 35 minutes
  • S&P 500

    -13.93 (-0.35%)
  • Dow 30

    -47.21 (-0.14%)
  • Nasdaq

    -72.31 (-0.66%)
  • Russell 2000

    -3.97 (-0.22%)
  • Crude Oil

    -2.05 (-2.76%)
  • Gold

    +19.50 (+1.09%)
  • Silver

    +0.59 (+2.62%)

    +0.0039 (+0.37%)
  • 10-Yr Bond

    -0.1050 (-2.99%)

    +0.0071 (+0.59%)

    -0.5580 (-0.41%)

    -154.26 (-0.91%)
  • CMC Crypto 200

    -7.16 (-1.78%)
  • FTSE 100

    -32.20 (-0.43%)
  • Nikkei 225

    -199.47 (-0.72%)

JetBlue set to buy Spirit Airlines for $3.8 billion after dissolution of Frontier deal

After a months-long battle for Spirit Airlines, JetBlue is finally set to acquire the company for $3.8 billion.

Video Transcript


DAVE BRIGGS: The months long battle for Spirit Airlines is over, and JetBlue is victorious. The budget airline has finally agreed to Jetblue's $3.8 billion bid. The merger would create the fifth largest airline in the country. The other airline that was vying for Spirit was, of course, Frontier Airlines. Yahoo Finance spoke to its CEO, Barry Biffle, to get his take on the acquisition.

BARRY BIFFLE: It's a great day for Frontier because we get to be the low cost carrier of the United States. And our employees are winning, but shareholders are going to get a windfall from this. And really, the only losers are the consumers that are going to have to pay over 40% more with Spirit.

DAVE BRIGGS: Surprisingly optimistic, but I guess you might expect that kind of tone. I want to turn back to two months ago, though, Seana, to something said by Ted Christie, the Spirit CEO, when the talk was just emerging of this potential merger. He said, of a JetBlue acquisition, quote, "The DOJ would not only oppose this transaction, but they would actually file suit to stop it." He was very confident that this would not be approved by federal regulators. And there is the biggest question as we move forward. It does not look likely if you follow the pattern of the Biden administration.

SEANA SMITH: Yeah, not good to be on record saying that, especially, then, if you agree to the JetBlue deal. You're right, though, to bring up the Biden administration and the likelihood or unlikelihood event that it will get approved because we know the Biden administration has been very tough on similar sort of deals that crack down on potential competitive behavior within an industry.

Rachelle, this new merger here between Spirit and JetBlue, it's going to create the fifth largest airline. So a little bit more competition when you're comparing it to the top four airlines here. But of course, it begs the question of what this does for the budget airline space.

RACHELLE AKUFFO: I mean, when you look at the stock price, what Frontier's doing, apparently, people seem to be happy that it wasn't Frontier, when you look at-- I think the stock is up about 20% on the day. But I mean, a lot of people are wondering, what does this mean in terms of the space for cheaper airlines, what this means for sort of the shake-up there.

You hope some of these costs will get passed, some of these costs won't get passed on to consumers, that you still will have more budget options. It does make it, obviously, much tighter now that you don't have-- now that you have this merger. But we'll see. Hopefully, we'll have some relief for the consumer, and it won't just be another case of more prices taking up that top five spot.