JBLU - Why Spirit Airlines Stock Is Up Today
2023-03-07 14:00:15 ET
The Department of Justice, as expected, has sued to try to block JetBlue Airways (NASDAQ: JBLU) from acquiring Spirit Airlines (NYSE: SAVE) . But 24 hours after Spirit shares fell on the rumor , today, the stock is actually up more than 3% on the news. Although an outcome is far from certain, some investors seem to see room here for a compromise.
Last summer, JetBlue outbid Frontier Holdings Group to acquire Spirit for $7.6 billion in cash, stock, and assumed debt. But investors knew from the start that a JetBlue/Spirit combination was likely to attract regulatory scrutiny, and on Tuesday, the DOJ followed through on that expectation.
The DOJ, along with the District of Columbia, Massachusetts, and New York, filed suit in a Massachusetts federal court to block a deal that Attorney General Merrick B. Garland said "would result in higher fares and fewer choices for tens of millions of travelers, with the greatest impact felt by those who rely on what are known as ultra-low-cost carriers in order to fly."
For further details see:
Why Spirit Airlines Stock Is Up Today