JetBlue Airways faces a quarter-century crossroads after Spirit rejects its takeover offer

JetBlue Airways is at a nearly quarter-century crossroads. The airline’s first flight took off from New York City for Fort Lauderdale in February 2000. Twenty-two years later, JetBlue executives again set their sights on South Florida with a surprise bid for Spirit Airlines. That first flight was a success, the bid was not. Spirit on Monday rejected JetBlue’s $3.6b all-cash offer and said it was sticking with a deal to merge with fellow ultra-low-cost carrier Frontier Airlines, an agreement struck in February valued at $2.9 billion. Spirit’s stock fell more than 9% on Monday after it announced it was turning down the JetBlue offer in favor of the Frontier deal, while JetBlue’s rose more than 2%. Miramar, Florida-based Spirit cited regulatory concerns in turning down the offer, saying it doubted a JetBlue acquisition would get approved, in part because of JetBlue’s Northeast partnership with American Airlines, which the Justice Department sued to block last year. The DOJ argued in its suit that it would drive up fares and hurt competition, specifically mentioning the importance of smaller carriers like JetBlue. JetBlue said it would divest Spirit assets in New York, Boston and some in Florida under a revised offer. The discount carrier still said no. Spirit CEO Ted Christie said during the airline’s Q1 call Thursday that he has “wondered whether blocking our deal with Frontier is, in fact, their goal.” Spirit’s rejection leaves JetBlue Airways at a turning point. Nearly 24 years after it was incorporated, JetBlue has grown from a quirky leisure airline based in New York City with one class of service into the sixth-largest airline in the US with more than 100 destinations from Los Angeles to Lima, Peru.<br/>