Alaska Airlines launched new daily, year-round nonstop flights between Seattle/Everett and Honolulu, as well as Portland and Miami.
06.11.2023 - 21:03 / thepointsguy.com / Robin Hayes / Ted Christie / Spirit Ceo / Airlines
New details about JetBlue and Spirit Airlines continue to emerge as the airlines face off with the Department of Justice in antitrust court.
The latest revelation: JetBlue has been interested in buying and merging with another airline for years and once saw Alaska Airlines as its ultimate objective.
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JetBlue had considered merger opportunities with several other smaller airlines in the 2010s, JetBlue CEO Robin Hayes testified in the U.S. District Court for the District of Massachusetts on Monday, looking to turbocharge its growth in order to compete with the four largest domestic airlines that dominate 80% of the U.S. market — American Airlines, Delta Air Lines, United Airlines and Southwest Airlines.
In 2015, JetBlue pursued a merger with Virgin America shortly after the younger airline's initial public offering but was famously outmaneuvered by a fiercely competitive Alaska Airlines following a bidding war — Alaska offered $57 a share, 47% over the closing price the day of the bid. The deal was finalized with Alaska paying $2.6 billion.
JetBlue nevertheless remained interested in acquiring another airline, Hayes testified.
In 2017, JetBlue began exploring options again, focusing on two potential airlines, one of which was Spirit, according to a document shown in court — the name of the other airline was redacted.
Both during the Virgin America bidding and the opportunity assessment in 2017, the primary motivation was to grow fast and build more of a national presence, Hayes said. A presentation made to JetBlue's board in 2017, shown in court on Monday, noted that "each option provides a unique strategic opportunity for JetBlue and builds a stronger platform to compete against the Big 4."
The plan was tabled because the price was expected to be too high, Hayes testified. He said he expected that any bid for Spirit would require a high premium like the one that Alaska had paid for Virgin, which JetBlue did not see as affordable.
JetBlue revisited its interest in Spirit in late 2019, launching a new program — codenamed "Project Exchange" — to consider a merger between the two. It saw the airlines' fleet commonalities and similar order books as a major opportunity, listing the strategic rationale for the project as the option to "unleash a sustainable challenger brand to the legacy airlines."
JetBlue's board voted in favor of pursuing an acquisition this time, and at its February 2020 meeting, it authorized Hayes to approach Spirit CEO Ted Christie. However, before he could weigh in, the coronavirus pandemic began affecting the airlines, and the project was put on hold until 2022, when Frontier and Spirit announced
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