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Spirit Airlines Plans To Begin Talks On JetBlue's Buy-out Proposal

Spirit Airlines Inc. (SAVE) said it has determined that the unsolicited proposal received from JetBlue Airways (JBLU) to acquire Spirit in an all-cash transaction for $33.00 per share could reasonably be likely to lead to a "Superior Proposal" as defined in Spirit's merger agreement with Frontier Group Holdings, Inc. (ULCC), parent company of Frontier Airlines Inc.

Spirit plans to engage in discussions with JetBlue with respect to JetBlue's proposal, in accordance with the terms of the company's merger agreement with Frontier.

Spirit said it remains bound by the terms of the merger agreement with Frontier, and Spirit's Board has not determined that JetBlue's proposal in fact constitutes a Superior Proposal as defined in the merger agreement with Frontier.

Spirit noted that its board has made no change to its recommendation that its shareholders adopt the merger agreement with Frontier.

On Tuesday, JetBlue confirmed that it submitted a proposal to the Board of Directors of Spirit to acquire Spirit for $33 per share in cash, implying a fully diluted equity value of $3.6 billion.

In February, Spirit Airlines reached a merger deal with Frontier Airlines. According to the deal, Spirit share holders would receive 1.9126 shares of Frontier plus $2.13 in cash for each existing Spirit share they own. This implies a value of $25.83 per Spirit share. Upon closing, existing Frontier equity holders would own about 51.5%, while Spirit equity holders would own around 48.5% of the combined airline.

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