Spirit Airlines stockholders have approved the merger agreement with JetBlue based on preliminary voting results, Spirit announced Wednesday. The completion of the deal is subject to closing conditions and regulatory approval, but the carriers expect to conclude the process and close the transaction “no later than the first half of 2024.”
JetBlue came out the winner earlier this year in a battle with Frontier Airlines for the low-cost carrier. Under the terms of the agreement, JetBlue will acquire Spirit for $33.50 per share in cash, including a prepayment of $2.50 per share in cash payable upon Spirit stockholders’ approval of the transaction, and a ticking fee of 10 cents per month starting in January 2023 through closing.
One possible bump in the road to regulatory approval is JetBlue’s Northeast Alliance with American Airlines and the antitrust lawsuit against the partnership, which is currently underway in Boston. In addition, Massachusetts Sen. Elizabeth Warren has written to Transportation Secretary Pete Buttigieg expressing “serious concerns” about the merger given that “airline industry competitiveness is in free fall,” and that the four largest airlines—American, Delta Air Lines, Southwest Airlines and United Airlines—"control 80 percent of the domestic market.”
Customer Profile
Decision intelligence company Morning Consult conducted a data analysis of JetBlue and Spirit customers and found that 36 percent of JetBlue flyers said they take on average one or more business trips on any airline within a year, while 41 percent of Spirit flyers do. About 26 percent of JetBlue and 27 percent of Spirit customers have flown in business or first class within the past year.
“What JetBlue is really getting out of this is an expansion of their geographic footprint in the United States and its territories,” Morning Consult tech analyst Jordan Marlatt told BTN. “In terms of business travel, JetBlue is expanding its access to a lot of new airports and routes.”
Marlatt noted that, not surprisingly, more JetBlue customers live in the Northeast, where the carrier is based, whereas Spirit customers tend to over-index in the South.
In addition, the low-cost aspect that Spirit brings to the table could help JetBlue attract companies that are more wary of spending on business travel, especially for shorter trips, he said.
The Morning Consult Brand Intelligence platform tracks daily consumer attitudes for more than 4,000 brands in more than 40 countries. The figures for this analysis are based on daily surveys conducted between Jan. 1 and Oct. 1, 2022, among a minimum sample of 43,463 respondents, including 6,457 JetBlue customers and 5,285 Spirit customers across a total of 273 polls. The interviews were conducted online in English and Spanish, and the data were weighted to approximate a target sample based on age, race/ethnicity, gender, educational attainment and region.