U.S. airline JetBlue announced Monday that it is abandoning its purchase of Miami-based low-cost carrier Spirit, a project that began in 2022 and was opposed by the Department of Justice for violating antitrust laws.
In a statement, JetBlue insists it believes “in the competitive benefits of the transaction (as) it would have resulted in a low-cost, high-value domestic competitor to the ‘big four.'”
In terminating the transaction, JetBlue will pay Spirit $69 million as part of the pre-agreement, adding that it “wishes the entire Spirit team the best course forward.”
Following JetBlue’s announcement, its shares were up 4.31% in early trading on Wall Street, while Spirit’s shares were down 11%.
Today’s decision was more or less expected after U.S. District Judge William Young blocked the purchase on January 16, arguing that “the elimination of Spirit would harm price-conscious travelers who rely on Spirit’s low fares”.
U.S. Attorney General Merrick Garland said at the time that the judge’s ruling was a victory for the “tens of millions of travelers who would have faced higher fares and less choice had the JetBlue-Spirit merger been allowed to go forward.”
According to Justice Department data, the four largest U.S. airlines – American Airlines, Delta Air Lines, United Airlines and Southwest Airlines – control 80% of the market.
Source: Arecoa.com
