JetBlue to sell Spirit Air’s LaGuardia assets to Frontier

JetBlue Airways agreed to sell Spirit Airlines’ operations at New York’s LaGuardia Airport to rival carrier Frontier. The deal is contingent upon JetBlue closing a planned $3.8b acquisition of Spirit, according to a statement Thursday. JetBlue had earlier pledged to divest some assets to help secure federal approval of the acquisition, which has been challenged by the US Justice Department over concerns it would hurt consumers and reduce industry competition. The sale is something of a consolation for Frontier, which had agreed to acquire fellow ultra-discount carrier Spirit before JetBlue came in with a higher offer. Spirit shareholders backed the JetBlue bid after it added a series of sweeteners, including special dividends. The agreement will let Frontier “significantly expand” its LaGuardia operations, CEO Barry Biffle said. Spirit’s holdings at LaGuardia include six gates and 22 takeoff and landing slots. The flying rights are highly sought within the industry because they’re limited and difficult to acquire. JetBlue also agreed previously to give up some Spirit assets in Boston and Florida. JetBlue is offering concessions because of the overlap of its operations and Spirit’s in certain markets. A combination of the carriers is the only way it can gain the size and heft to compete with the nation’s three largest airlines that control about 80% of the market, JetBlue has argued.<br/>