Spirit says Frontier proposal would bring less value to stakeholders

Spirit Airlines (SAVE) disclosed that following discussions among the company, Frontier Group (ULCC) and the confidentiality agreement parties, the company determined that the takeover proposal by Frontier would deliver less in value to stakeholders than what was contemplated by its existing plan, is uncertain as to timing and completion, including the need for regulatory and court approvals, and is not actionable considering it would require the confidentiality agreement parties to invest $350M in equity, which they were not willing to do based on the terms of the proposal. Furthermore, unless waived by the relevant consenting stakeholders, the proposal would have required Spirit to pay a $35M backstop fee under its court-approved equity rights offering backstop agreement. Spirit Airlines has determined, barring new developments, not to further delay its planned emergence from Chapter 11. “The Company continues to advance through its restructuring process, which will significantly deleverage the Company and position it for long-term success,” it added.