JetBlue has announced that it has entered a definitive agreement to divest all of its New York LaGuardia holdings to Frontier Airlines.
The announcement comes in connection to JetBlue’s planned merger with Spirit Airlines, and will ensure the preservation of ultra low-cost services at the New York airport.
The holdings include maintenance of six terminal gates, and also includes 22 takeoff and landing spots at LaGuardia airport.
The transfer arrangement will be conditional upon the finalisation of the JetBlue-Spirit Airlines merger.
“We are committed to ensuring our combination with Spirit preserves ultra low-cost carrier access in New York,” said Robin Hayes, chief executive officer, JetBlue.
“We are pleased that this agreement with Frontier will maintain the same level of ultra low-cost carrier service at LaGuardia Airport.”
“We’re pleased to have reached this agreement to acquire Spirit’s slot pairs and leasehold interests at New York’s LaGuardia Airport, pending regulatory approval of the JetBlue-Spirit merger,” said Barry Biffle, President and CEO, Frontier Airlines.
“It will enable us to significantly expand our operations at LaGuardia and deliver even more ‘Low Fares Done Right’ to consumers in the greater New York City area.”
Under the terms of the agreement, JetBlue has agreed to transfer to Frontier all of Spirit’s holdings at LaGuardia, principally consisting of six gates at the Marine Air Terminal and 22 takeoff and landing slots.
The divestitures are conditioned upon, and will occur after the closing of, JetBlue’s planned combination with Spirit and are subject to additional closing conditions, including approval by the Port Authority of New York and New Jersey and the FAA/DOT.
JetBlue expects to close the transaction with Spirit in the first half of 2024.
The JetBlue-Spirit merger
The proposed merger between JetBlue and Spirit Airlines has something of a long and complicated history.
In July 2022, JetBlue made an unsolicited offer to acquire Spirit for $3.6 billion. Spirit’s board of directors initially rejected the offer, but after JetBlue sweetened the deal to $3.8 billion, Spirit subsequently agreed to the proposed merger.
The proposed merger has been met with opposition from the Justice Department, which filed a lawsuit to block the deal in March 2023. The Justice Department argued that the merger would reduce competition and lead to higher fares for consumers.
JetBlue has argued that the merger would actually benefit consumers by creating a new, low-cost competitor to the nation’s four largest airlines. JetBlue has also said that it would be willing to divest some of Spirit’s assets to address the Justice Department’s concerns.
The Justice Department’s lawsuit is still pending, and it is unclear when a decision will be made. If the merger is approved, it would effectively create the fifth-largest airline in the United States.
The US domestic market is currently dominated by the ‘Big Four’ airlines; namely American Airlines, Delta Air Lines, Southwest Airlines, and United Airlines.
JetBlue is New York’s Hometown Airline®, and a leading carrier in Boston, Fort Lauderdale-Hollywood, Los Angeles, Orlando, and San Juan.
JetBlue carries customers to more than 100 destinations throughout the United States, Latin America, Caribbean, Canada, and United Kingdom.
Frontier Airlines is committed to “Low Fares Done Right.” Headquartered in Denver, Colorado, the company operates 125 A320 family aircraft and has among the largest A320neo family fleets in the US.
The use of these aircraft and Frontier’s seating configuration, weight-saving tactics, and baggage process have all contributed to Frontier’s continued ability to be the most fuel-efficient of all major U.S. carriers when measured by ASMs per fuel gallon consumed.
With more than 220 new Airbus planes on order, including direct leases, Frontier will continue to grow to deliver on the mission of providing affordable travel across America.