Spirit Airlines Extends Debt Deadlines, JetBlue Founder Suggests Frontier Group A More Suitable Match - Themes Airlines ETF (NASDAQ:AIRL), LeaderShares Activist Leaders ETF (ARCA:ACTV)
- Spirit Airlines extended its 2025 notes deadline on October 11 amid bankruptcy concerns.
- The budget airline fully utilized its revolving credit facility and has reported losses continuously since the pandemic.
- JetBlue's founder suggested a merger with Frontier Group would have been more suitable after the failed partnership with JetBlue.
In the United States on October 11, Spirit Airlines announced modifications to its card processing agreement, extending the deadline for its 2025 notes. This came amidst bankruptcy concerns, as the airline was renegotiating its payment processing with the U.S. National Bank Association. On October 15, Spirit revealed significant financial strain, having fully utilized a $300 million revolving credit facility and fearing a cash shortfall while struggling to achieve profitability since the pandemic started. Multiple factors, including unresolved issues with Pratt & Whitney engines and a halted merger with JetBlue due to antitrust rulings, have compounded the airline's challenges. JetBlue’s founder criticized the halted merger, suggesting that a partnership with Frontier Group would have been a more advantageous move for Spirit. As part of its strategic overhaul, Spirit plans to cut costs, exit unprofitable markets, and enhance operational efficiency in the upcoming years, aiming for substantial annual savings despite ongoing losses.