Spirit Airlines said Thursday it was again postponing a shareholder vote on a proposed merger with Frontier Airlines to continue negotiations with Frontier and rival bidder JetBlue Airways.
The vote was delayed from Friday until at least July 15.
It was the third time that Spirit called off a vote on the Frontier deal that is favored by the Spirit board. The delay appeared to indicate that the merger of the two discount airlines lacks shareholder support in the face of a JetBlue bid that is higher in current value.
Florida-based Spirit, the nation's largest discount airline, struck a deal with Frontier in February and has stuck with it as a bidding war heated up between Denver-based Frontier and New York-based JetBlue.
The zeal of JetBlue’s pursuit has surprised many in the airline industry and been met with skepticism on the stock market. Through Thursday, shares of JetBlue have tumbled 43% since it entered the bidding war, more than any other major U.S. airline. Frontier, now seen as unlikely to get Spirit, has dipped 10% during the same stretch.
JetBlue is offering Spirit shareholders $33.50 in cash, or $3.6 billion. Frontier's bid is mostly stock and only $4.13 per share in cash. At Frontier's current stock price, the airline's bid is worth about $22 per share, or $2.4 billion.
Spirit and Frontier argue that over the long run, their combined company will be worth more than JetBlue's offer. They also argue that antitrust regulators will block JetBlue from buying Spirit.
JetBlue says it can win antitrust approval, and that Spirit shareholders who believe airline shares will rise can plow the cash they get from JetBlue back into airline stocks.
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