JetBlue and Frontier Airlines recently announced a divestiture agreement on account of JetBlue’s merger with Spirit Airlines. Under this agreement, JetBlue has announced that it can divest all of its holdings of Spirit Airlines at Latest York City’s LaGuardia Airport (LGA) to Frontier Airlines.
This specific divestiture was agreed upon as an upfront commitment during early talks of the merger agreement with Spirit. This divestiture agreement can also be conditioned on the closing of the JetBlue and Spirit Airlines merger.
Transfer of spots at LaGuardia Airport
Frontier Airlines will take control of all of Spirit’s holdings at LaGuardia Airport after the merger between JetBlue and Spirit is finalized. This includes the six gates that Spirit is currently in charge of on the Marine Air Terminal. The holdings also include 22 takeoff and landing spots on the airport. The agreement for Frontier to take over the holdings can also be conditioned upon approval by the Port Authority of Latest York and Latest Jersey, in addition to the Federal Aviation Administration (FAA) and Department of Transportation (DOT).
Photo: Vincenzo Pace | Easy Flying
The President and Chief Executive Officer of Frontier Airlines, Barry Biffle, was thrilled with the prospect of acquiring more critical space at the favored LaGuardia Airport. He stated,
“We’re pleased to have reached this agreement to amass Spirit’s slot pairs and leasehold interests at Latest York’s LaGuardia Airport, pending regulatory approval of the JetBlue-Spirit merger. It would enable us to significantly expand our operations at LaGuardia and deliver much more ‘Low Fares Done Right’ to consumers within the greater Latest York City area.”
As well as, each Spirit Airlines and JetBlue are acting upon conditions agreed upon in the course of the early stages of merger talks. JetBlue firmly believes the merger will move towards closing and moreover expects that the transaction will close with Spirit Airlines in the primary half of 2024. The Chief Executive Officer of JetBlue, Robin Hayes, spoke about Frontier Airlines keeping low-cost options in Latest York. He stated,
“We’re committed to making sure our combination with Spirit preserves ultra-low-cost carrier access in Latest York. We’re pleased that this agreement with Frontier will maintain the identical level of ultra-low-cost carrier service at LaGuardia Airport.”
The Spirit and JetBlue merger slowly moves along
JetBlue and Spirit Airlines agreed to a $3.8 billion deal in the summertime of 2022 during which JetBlue would acquire Spirit. The 2 airlines checked out merging together with the intention to create a fifth domestic airline in the US. Currently, the Big 4 domestic airlines, United Airlines, American Airlines, Delta Air Lines, and Southwest Airlines, make up nearly 80% of the market in the US.
Photo: Lukas Souza | Easy Flying
Nonetheless, shortly after the deal was announced, the US Department of Justice sued to dam the acquisition. Their reasoning was to forestall industry consolidation and argued that the merger would eliminate competition within the ultra-low-cost market. The DOJ also said that the merger could be harmful to working-class Americans throughout the country. A date for the antitrust trial was set for October sixteenth, 2023.
Along with the suit to dam the Spirit and JetBlue merger, a judge in Boston recently ruled in favor of a 2021 lawsuit that will end the Northeast Alliance, which is a partnership between American Airlines and JetBlue. American Airlines announced that it could appeal the judge’s ruling earlier this week.
