The bidding war for Spirit Airlines Inc between Frontier Group Holdings Inc and JetBlue Airways Corp may leave the acquirer taking years to earn back their investment. JetBlue’s latest cash-and-stock bid values Spirit at $3.7 billion, while Frontier’s latest cash-and-stock bid, which Spirit recommends its shareholders should back, is worth $2.4 billion. Spirit has delayed its shareholder vote on the deal for a third time to July 15 to negotiate further with both suitors. JetBlue and Frontier may have to wait anywhere from three to five years or even longer to recoup their investment if they are successful, according to a dozen investment bankers and analysts interviewed by Reuters. Frontier expects the combined company to deliver annual synergies of roughly $500m, most of which will start kicking in roughly three or four years after the deal is completed. JetBlue says a tie-up with Spirit will deliver synergies of $600m to $700m the first year after integration is complete. Airline experts said the long-term synergies cited by both JetBlue and Frontier make it worth the price the companies are willing to pay for Spirit, although some analysts cautioned that the bidding war might strain their finances in the near term. “We are probably heading into a recession. This is not the right time to borrow a lot of money to buy a competitor,” said Israel Shaked, professor emeritus of finance at Boston University.<br/>
unaligned
Spirit Airlines shareholder Discovery Capital Management Tuesday urged the low-cost carrier to abandon its merger with Frontier Group Holdings in favor of a bid from JetBlue Airways. Discovery became the second major Spirit shareholder to publicly back a merger with JetBlue, which is vying with Frontier to expand in the United States and create the country's fifth-largest airline. Discovery owns 1.4% of Spirit. Last month, Spirit shareholder TIG Advisors LLC also informed the carrier's board of directors that it intends to vote against Frontier's bid with the low-cost carrier. The Spirit shareholder vote, which has been delayed twice before, was pushed back for a third time to enable the airline to have more conversations with JetBlue and Frontier to finalize a deal. However, Frontier on Monday declined to further raise its bid for Spirit, potentially drawing the curtains on its months-long bidding war with JetBlue. Institutional Shareholder Services (ISS) last month said JetBlue's latest offer to buy Spirit was "more favorable" for the ultra-low-cost airline's shareholders, but maintained its support for the Frontier deal. "We echo the opinion of ISS that the JetBlue proposal is more favorable, and we implore SAVE management to abandon the Frontier Merger without delay," Discovery said.<br/>
A regional jet flying for United Airlines crash-landed in a snow-covered field adjacent to a runway in Maine after pilots attempted to touch down without seeing the runway, investigators said Tuesday. The March 4, 2019, accident on a CommutAir flight with 32 people aboard was one of the most severe on a US carrier in recent years and caused significant damage to the plane. It led to a chaotic evacuation in the snow and three people suffered minor injuries, the NTSB said in a final report. A string of errors and miscues caused the crash on the flight from Newark, New Jersey, to Presque Isle, Maine, the NTSB said. An instrument landing system had malfunctioned because equipment was covered by snow and guided the jet to the right of the runway. Even though CommutAir pilots had noticed the malfunction days earlier, some didn’t report it and the system wasn’t repaired. But the primary reason the plane touched down in a field between 200 and 300 feet to the right of the runway was that the pilots continued to descend even though they couldn’t make out the runway in the snow, the NTSB concluded. “I don’t know what I’m seein,’” an unspecified pilot said as the plane was less than 100 feet off the ground, according to the report. Neither pilot suggested aborting the landing. <br/>
Airlines Norwegian Air and Wideroe have agreed to cooperate on the Norwegian domestic market and onward travel, including joint ticket and passenger interlining, the firms said Tuesday. "The combination of Wideroe's network along the coast and in northern Norway and Norwegian's large European route network will create many new travel opportunities for our common customers," Wideroe CEO Stein Nilsen said. Privately owned Wideroe, Scandinavia's largest regional airline, serves short-haul routes in a sparsely populated region with few train lines and challenging geography. A slimmed-down version of Norwegian Air emerged from bankruptcy proceedings last year with no long-distance network.<br/>