The agreement capped a months-long bidding war and arrives one day after Spirit’s attempt to merge with fellow budget carrier Frontier Airlines fell apart.
Spirit Airlines Inc has agreed to a $3.8 billion buyout offer from low-cost rival JetBlue Airways Corp, ending a drawn-out battle for the carrier whose acquisition would help create the fifth-largest US airline.
Thursday's announcement comes after Spirit cancelled its $2.7 billion sale to Frontier Group Holdings, but the potential combination is expected to kick off a fight with antitrust regulators.
JetBlue's offer price of at least $33.50 per share represents a premium of nearly 38 percent to the last closing price of Spirit shares.
Including a "ticking fee", or small monthly payments to Spirit shareholders from January next year until the deal is completed, the offer can go up to $34.15 per share.
Spirit shares were up nearly 5 percent before the bell as investors cheered the end of a takeover saga that began in April.
JetBlue rose 1 percent, while Frontier was 1.6 percent higher.
Both carriers were locked in a bidding war to create a combined airline that will better compete with legacy US carriers at a time when the industry faces a labour crunch and high jet fuel costs.
JetBlue Airways launches a hostile takeover bid for Spirit Airlines, offering $33 in cash per share pic.twitter.com/4GWn5Hw3MX— TRT World Now (@TRTWorldNow) May 16, 2022
Spirit had in February agreed to a $2.9 billion offer from Frontier before JetBlue jumped into the fray in April.
Despite JetBlue's better terms, Spirit had pushed for a merger with Bill Franke-backed Frontier, citing antitrust concerns with a potential JetBlue tie-up.
But it could not muster investor support for the deal and was forced to delay a shareholder vote on the proposed acquisition four times.
At the latest meet that was set for Thursday, Spirit shareholders were expected to vote against a merger with Frontier.
Spirit cancelled the merger with Frontier without giving details on results of the shareholder meet.
The outcome is a setback for Franke, who was instrumental in starting the talks with Spirit last year.
Franke's airline-focused buyout firm, Indigo Partners, is a major shareholder in Frontier.