(Reuters) – Spirit Airlines Inc on Thursday agreed to a $3.8 billion buyout offer from low-cost rival JetBlue Airways Corp, ending a drawn-out battle for the carrier that would help create the fifth-largest U.S. airline.
The offer price of at least $33.50 per share represents a premium of nearly 38% to Spirit’s Thursday closing price.
Including a “ticking fee”, or small monthly payments to Spirit shareholders from January next year until the deal is completed, the offer can go up to $34.15 per share.
Spirit also terminated a deal with Bill Franke backed-Frontier Group Holdings Inc, its rival suitor with whom it had agreed to a $2.9-billion offer in February before JetBlue jumped into the fray.
Both JetBlue and Frontier were locked in an intense bidding war for Spirit to create a combined airline that will better compete with legacy U.S. carriers at a time when the industry faces labor crunch and high jet fuel costs.
(Reporting by Abhijith Ganapavaram in Bengaluru; Editing by Sriraj Kalluvila and Arun Koyyur)
