2023-03-06 12:56:00 ET
Regulators are reportedly looking to block the prospective merger between JetBlue Airways ( NASDAQ: JBLU ) and Spirit Airlines ( NYSE: SAVE ), sending shares of the latter sliding.
Both the Department of Transportation and Department of Justice are looking to halt the deal on the grounds that the merger would be anti-competitive, according to Bloomberg.
Per prior media reports, executives from the carriers met with the DOJ in late February in a "last-rites" meeting to assuage regulatory concerns on the planned merger. That meeting followed reports earlier in February that the department was planning to file a suit as early as this month. Per the latest reports, the efforts to shift the DOJ’s stance on the deal were unsuccessful as a suit is due to be filed as soon as Tuesday.
Citing people familiar with the matter, Bloomberg also indicated that the Department of Transportation will launch a parallel proceeding to “block the transfer of Spirit’s airline certificate as incompatible with the public interest.” This is a power the agency hasn’t used since the deregulation of the industry under the Carter administration.
Shares of JetBlue Airways ( JBLU ) rose 2.22% in afternoon trading while Spirit Airlines ( SAVE ) stock slumped over 9% before rebounding modestly.
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Spirit Airlines stock nosedives as JetBlue deal looks to be in jeopardy