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Spirit shareholder vote finally underway on Frontier deal clouded by rival JetBlue bid

A Frontier Airlines plane near a Spirit Airlines plane at the Fort Lauderdale-Hollywood AIRPORT TERMINAL on, may 16, 2022 in Fort Lauderdale, Florida.

Joe Raedle | Getty Images

Spirit Airlines shareholders were finally voting Wednesday on a well planned tie-up with Frontier Airlines, a deal that is on the rocks carrying out a rival bid from JetBlue Airways this spring.

Spirit had postponed the vote four times since it struggled to assemble enough shareholder support for the Frontier merger, that your carriers first announced in February.

Frontier told Spirit earlier this month that its latest sweetened cash-and-stock offer was its “best and final” bid. But Spirit still lacks stockholder support for the offer, according to an individual familiar with the problem.

The meeting began Wednesday morning and went into recess until 4 p.m. ET. Polls are open until 4: 15 p.m. ET and the airline plans to announce results shortly afterward.

A rejection of the Frontier deal will be a blow to the discount carriers that planned to combine forces right into a budget behemoth and the country’s fifth-largest airline.

Spirit shareholders will vote only on the Spirit-Frontier transaction, rather than on the rival bid by JetBlue, which spent weeks urging shareholders to show the Frontier deal down.

The vote could clear just how for Spirit to potentially strike a cope with JetBlue, that is seeking to choose the budget airline outright and refurbish its planes in JetBlue style, featuring seatback screens and much more legroom. Talks are ongoing, in accordance with a person acquainted with the negotiations, but it’s still possible they break apart.

Spirit’s board has repeatedly rebuffed JetBlue’s advances, arguing that it had been unlikely that regulators would approve the offer.

It’s possible that neither deal gets done. Both transactions would face a higher hurdle for the Justice Department’s blessing as the Biden administration has vowed to crack down on consolidation.

Executives for several three airlines said their preferred deal would help them grow quickly and better contend with the very best four U.S. carriers American, Delta, United and Southwest which control about three-quarters of the domestic market.

Spirit, however, has raised concerns in regards to a JetBlue takeover due to the New York-based carrier’s alliance with American in the Northeast, a partnership the Justice Department this past year sued to undo.

On Monday, Frontier Airlines moved up its second-quarter earnings release and conference call to 4: 30 p.m. Wednesday, soon after Spirit’s meeting. That they had been previously scheduled for Thursday.

Correction: A previous version of the story misstated when Frontier announced it could progress its earnings report. It made the announcement on Monday.

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