Spirit Airlines files for bankruptcy; lost $2.2b in 5 years
Spirit Airlines, whose approach to selling cheap tickets without amenities earned it fans and detractors, filed for bankruptcy protection on Monday after a string of setbacks, most recently a failure to renegotiate its looming debt. The airline, which last reported an annual profit in 2019, has had trouble finding its footing after a federal judge blocked a planned merger with JetBlue Airways in January. Spirit has also struggled to capitalize on the recovery from the pandemic because of intense competition, engine problems and other factors. The company filed for Chapter 11 bankruptcy protection in New York. It also announced an agreement with bondholders to restructure its debts and raise money to help it operate during the bankruptcy process, which it expected to exit in the first quarter of next year. Spirit, which has lost more than $2.2b since the start of 2020, published an open letter to customers saying that fliers could “use all tickets, credits and loyalty points as normal.” Ted Christie, the airline’s CE, said in a statement that the arrangements announced on Monday represented a “a strong vote of confidence in Spirit and our long-term plan.” The airline said in a court filing that it had 25,000 to 50,000 creditors, with total debt of about $9b and only slightly more in assets at end of September. It said its shares would be delisted from the New York Stock Exchange. Spirit’s stock had fallen more than 90% since the start of the year. The airline began operations as a trucking company operating under a different name in 1964. It later became a tour operator and started offering flights in 1990. Two years later, it became Spirit Airlines. But the company’s modern incarnation traces its roots to 2006, when Indigo Partners, a private equity fund, acquired a majority stake. Under Indigo and the leadership of Ben Baldanza — who spent a decade as Spirit’s CE and died this month — the airline focused on lowering costs and selling cheap, bare-bones tickets.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2024-11-19/unaligned/spirit-airlines-files-for-bankruptcy-lost-2-2b-in-5-years
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Spirit Airlines files for bankruptcy; lost $2.2b in 5 years
Spirit Airlines, whose approach to selling cheap tickets without amenities earned it fans and detractors, filed for bankruptcy protection on Monday after a string of setbacks, most recently a failure to renegotiate its looming debt. The airline, which last reported an annual profit in 2019, has had trouble finding its footing after a federal judge blocked a planned merger with JetBlue Airways in January. Spirit has also struggled to capitalize on the recovery from the pandemic because of intense competition, engine problems and other factors. The company filed for Chapter 11 bankruptcy protection in New York. It also announced an agreement with bondholders to restructure its debts and raise money to help it operate during the bankruptcy process, which it expected to exit in the first quarter of next year. Spirit, which has lost more than $2.2b since the start of 2020, published an open letter to customers saying that fliers could “use all tickets, credits and loyalty points as normal.” Ted Christie, the airline’s CE, said in a statement that the arrangements announced on Monday represented a “a strong vote of confidence in Spirit and our long-term plan.” The airline said in a court filing that it had 25,000 to 50,000 creditors, with total debt of about $9b and only slightly more in assets at end of September. It said its shares would be delisted from the New York Stock Exchange. Spirit’s stock had fallen more than 90% since the start of the year. The airline began operations as a trucking company operating under a different name in 1964. It later became a tour operator and started offering flights in 1990. Two years later, it became Spirit Airlines. But the company’s modern incarnation traces its roots to 2006, when Indigo Partners, a private equity fund, acquired a majority stake. Under Indigo and the leadership of Ben Baldanza — who spent a decade as Spirit’s CE and died this month — the airline focused on lowering costs and selling cheap, bare-bones tickets.<br/>
