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JetBlue Airways is offering up Spirit Airlines gates and slots at LaGuardia Airport (LGA) in hopes of getting its $3.8 billion acquisition one step closer to happening.
An agreement with Frontier was announced today that would divest Spirit’s entire holdings at LaGuardia. If approved, Frontier would gain six gates and 22 slots (permission for takeoffs and landings). This divestiture, plus others agreed upon already in the merger agreement, could bring JetBlue closer to getting this deal done (the carrier is anticipating it closing in the first half of 2024). If approved, JetBlue would become the fifth largest US carrier.
This does not remedy the lawsuit filed by the Department of Justice (DOJ) to block the acquisition, but it does show that JetBlue is willing to negotiate to move this along. The DOJ filed a lawsuit because it believes that this merger would drive airfare higher. It seems to have forgotten past mergers, which were approved in recent history including American Airlines acquiring US Airways, Delta Air Lines purchasing Northwest Airlines, United Airlines merging with Continental Airlines (I miss you, CO), and Southwest Airlines buying AirTran.
This is not the only legal issue that JetBlue currently faces. Its Northeast Alliance with American Airlines was blocked on May 19th (more on that here). Judge Leo T. Sorokin wrote that the alliance “substantially diminishes competition in the domestic market for air travel.” That partnership was given 30 days to wind down, but it looks like American Airlines is going to file an appeal.
Anthony’s Take: I’ve locked in my Spirit Airlines Gold status until December 2024. If this merger goes through I wonder how it will map to JetBlue status. I believe that JetBlue will eventually get the green light to merge with Spirit, but think its Northeast Alliance will be the casualty in these deals.
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