The two American airlines Frontier and Spirit have resumed talks about a possible merger, according to information from the Wall Street Journal. The news causes Spirit's struggling stock to surge by 40 percent.
The American low-cost airline Spirit is in a tough financial situation. Despite strong demand for travel, the company has only reported losses in one of the last six quarters, and there are doubts in the market that management will be able to handle upcoming debt maturities.
Now, however, a competitor, Frontier Airlines, is considering making a bid for Spirit. According to information to the Wall Street Journal, discussions between the two companies are in an early stage. Di writes.
However, that didn't stop the market from sending Spirit's stock up 40 percent on Wednesday evening. That's welcome news for investors who have seen the stock plummet by over 80 percent over the past year.
Spirit and Frontier discussed a possible merger as early as 2022, but it was thwarted by JetBlue's bid. JetBlue and Spirit eventually reached an agreement to merge – but that deal was halted earlier this year by US antitrust authorities.
Source: DI.SE
