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Frontier Group’s latest offer for Spirit Airlines prompted consulting firm Institutional Shareholder Services Inc (ISS) to cancel its opinion on the deal.
ISS is now calling on Spirit Airlines shareholders to vote on a proposed merger with Frontier’s parent company.
This is a change from a month ago, when the consulting firm asked Spirit shareholders to reject Frontier’s offer, saying JetBlue’s competitive offer of $ 30 per share was better from a financial point of view.
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A Frontier Airlines plane is piloting a Spirit Airlines plane at Indianapolis International Airport in Indianapolis, Indiana. (Photographer: Luke Charette / Bloomberg via Getty Images / Getty Images)
Since the beginning of April, Spirit has been the subject of a bidding war between Frontier and JetBlue Airways Corp.
SPIRIT AIRLINE COMPETITION: JETBLUE, BORDER JOKE FOR VICTORY
“Ultimately, support for the merger with Frontier under the revised terms is justified,” the consulting firm said in a report released late Friday.
Spirit Airlines said on Friday that Frontier had improved its offer by raising its cash offer by $ 2 per share and urged its shareholders to support the merger deal with Frontier at a meeting next week.
A JetBlue plane lands next to a Spirit Airlines plane on a taxi at Hollywood Fort Lauderdale International Airport. (Joe Cavaretta / Sun Sentinel / Tribune News Service via Getty Images / Getty Images)
JetBlue sweetened its offer for Spirit by $ 2 to $ 33.50 per share earlier this month.
JETBLUE UPS ANTE FOR SPIRIT
The vote by Spirit shareholders for the merger with Frontier is scheduled for June 30.
Ticker Security Last Modified Change% SAVE SPIRIT AIRLINES INC. 24.54 +0.71 + 2.98% ULCC FRONTIER GROUP HOLDINGS 10.54 +0.65 + 6.57%
The ISS said Frontier’s current offer matched the $ 2.00 increase in JetBlue’s offer price and also provided a higher prepayment of $ 2.22 per share compared to $ 1.50 per share from JetBlue.
JETBLUE OFFERS TO BUY SPIRIT AIRLINES FOR ABOUT $ 3.6 BILLION IN CASH
Frontier also increased its termination fee to Spirit by $ 100 million to $ 350 million.
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Spirit has repeatedly rejected JetBlue’s offer due to concerns about gaining approval from US regulators.
Reuters contributed to this report.
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