Frontier Airlines Again Proposes Merger With Rival Carrier Spirit

U.S. discount carrier Frontier Airlines (ULCC) is again proposing to merge with its rival Spirit Airlines (SAVE), which is currently involved in bankruptcy proceedings.Frontier and Spirit first announced a merger back in 2022, but another takeover bid from JetBlue Airways (JBLU) ended up scuttling that deal. Then, JetBlue’s acquisition of Spirit Airlines was blocked by a federal judge, citing competition concerns in the domestic U.S. aviation industry.Left on its own, Spirit Airlines, which has struggled financially since the Covid-19 pandemic in 2020, filed for Chapter 11 bankruptcy last November.The original merger offer from Frontier Airlines had valued Spirit at $2.9 billion U.S. It’s not clear what the value would be now that Spirit has entered bankruptcy. Frontier said in a news release that it has met with Spirit’s board of directors and senior executives before announcing the renewed merger proposal. The statement from Frontier also says that Spirit’s plans to emerge from bankruptcy as a standalone company will “likely result in an unprofitable airline with a high debt load and limited likelihood of success.”The new merger proposal comes as corporate America bets on a more friendly view of industry consolidations and takeovers under the new administration of U.S. President Donald Trump. Frontier Airlines’ stock has gained 42% over the past year to trade at $7.78 U.S. a share.