Shares of Spirit rose 1.6% in early trading.
Under JetBlue’s revised terms, Spirit shareholders would receive $31.50 per share in cash, comprising $30 at deal close and prepayment of $1.50 from a raised reverse break-up fee soon after Spirit shareholders vote to approve a deal.
JetBluelast month offered $30 in a hostile takeover bid for Spirit after initially offering $33 per share.
JetBlue Chief Executive Robin Hayes told CNBC that the airline had made “unprecedented divestiture commitments” to win regulatory approval.
“We know what it takes to get this deal done,” Hayes said. “We need the Spirit board to seriously consider our offer.”
The NEA is already in the crosshairs of the Justice Department, which sued JetBlue in September to unwind the partnership.
The latest offer from JetBlue, however, might put pressure on Spirit’s board to consider a deal with them, especially if shareholder advisory firms Institutional Shareholders Services and Glass Lewis choose to side with the latest JetBlue offer, experts said.
It remains to be seen whether Spirit finally decides to engage with JetBlue. Spirit is still committed to its deal with Frontier, the sources said, but may be forced to switch sides if they face mounting pressure from large institutional shareholders.
On Monday, JetBlue raised its reverse break-up fee by $150 million to $350 million, which is payable to Spirit shareholders in case the deal falls through due to antitrust reasons.
Frontier had agreed to pay $250 million in break-up fees.
Last week, proxy advisory firm Glass Lewis recommended that Spirit Airlines investors approve the deal with Frontier Group after another proxy firm, Institutional Shareholder Services Inc, advised against it. The new JetBlue offer will trigger ISS and Glass Lewis opinion revisions on the Frontier deal, the sources added.
Source : Nbcnewyork