Low-Cost Mega-Merger As Frontier & Spirit Get Together

Frontier Airlines and Spirit Airlines, the two largest low-cost carriers in the U.S., have announced plans to merge in a deal valued at US$6.6 billion.

The deal will create the fifth-largest airline in the country. In 2019, Frontier and Spirit's combined market share was 5.4% of the overall U.S. market. Denver-based Frontier will hold a 51.5% controlling stake in the combined airline.

"This transaction is centered around creating an aggressive ultra-low fare competitor to serve our guests even better, expand career opportunities for our team members and increase competitive pressure, resulting in more consumer-friendly fares for the flying public," said Ted Christie, president and CEO of Florida-based Spirit, in a statement announcing the deal.

Frontier Chairman Bill Franke will chair the combined company, which he said "will create America's most competitive ultra-low fare airline for the benefit of consumers." The companies didn't announce the new name of the combined carrier, the CEO or location of the airline's headquarters.

Those questions will be answered after the transaction closes, which is expected in the second half of the year, pending regulatory and shareholder approval.

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