CoffeeIcePapers
Well-Hung Member
I don't think Franke cares. If he can bid up JetBlue and eliminate his biggest competitor, that's fine with him.
Spirit and Frontier to Merge
- Thread starter Ian_J
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I don't think Franke cares. If he can bid up JetBlue and eliminate his biggest competitor, that's fine with him.
Cherokee_Cruiser
Bronteroc
…unless JetBlue actually wins.
turbojet28
Well-Known Member
I highly doubt in the current climate that Franke “doesn’t care” whether or not this deal happens. Indigo Partners and Bill Franke strike me as a very shrewd group of operators who are extremely calculated and keep their cards very close to the vest. Franke has arguably the most extensive background in M&A activity in the history of the airline industry.
It has, however, been eerily silent from Frontier ever since this JetBlue insertion into the mix a couple months ago. They have been able to hide behind Spirit’s defense of “regulatory risk” in the JetBlue offer and have not offered a single penny more to the actual value of the transaction.
This has been fascinating to watch, and it will be fascinating to see how it unfolds in the coming week(s). As an employee caught in the middle of this mess it is a bit unsettling. All I can do is hope everyone involved ends up in a good spot.
It has, however, been eerily silent from Frontier ever since this JetBlue insertion into the mix a couple months ago. They have been able to hide behind Spirit’s defense of “regulatory risk” in the JetBlue offer and have not offered a single penny more to the actual value of the transaction.
This has been fascinating to watch, and it will be fascinating to see how it unfolds in the coming week(s). As an employee caught in the middle of this mess it is a bit unsettling. All I can do is hope everyone involved ends up in a good spot.
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Spirit Airlines delays shareholder vote on Frontier deal
Spirit Airlines Inc said on Wednesday it had postponed a shareholder vote on its sale to Frontier Group Holdings Inc to June 30 from June 10 after JetBlue Airways Corp sweetened a rival offer for the budget carrier.
www.reuters.com
Looks like JetBlue successfully ran the price up on Dollar Bill Franke. It will be interesting to see how badly he wants the merger.
Cherokee_Cruiser
Bronteroc
Sorry, I voted no. My 1150 votes are meaningless. But I imagine many other institutional owners are looking at taking the immediate JetBlue cash versus F9 assumptions for the future. The fact that Franke hasn’t upped the F9 offer with the exception of increasing the break up fee is, well, dumb.
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he didn’t need to. he might still not. The vote isn’t to pick green or blue, the vote is to pick green. If it gets voted down, and the board is forced to consider the other offer(s), Franke might sweeten the pot. Right now he would only be bidding against himself.
ryan4sail
Well-Known Member
Unless B6 already has already proxied 50% +1 vote
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i don’t think that’s how this works
ryan4sail
Well-Known Member
Really, how so? Explain
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The vote is simply whether to accept the existing, agreed-upon deal. Nothing more, nothing less. All JB gets out of a no vote is an opportunity to further negotiate. A no vote doesn’t mean that JB gets Spirit, all it means is that the shareholders are rejecting the original Frontier offer. That’s why Franke hasn’t raised the offer. This isn’t an auction.
Cherokee_Cruiser
Bronteroc
Isn't the logical conclusion that if SAVE shareholders vote "no" on the F9 deal, the reason they are voting no is because they want jetBlue?
I mean, you're technically correct. But I don't see how SAVE voting no F9 means anything other than the B6 purchase going forward. It's the next logical conclusion.
upup89
Well-Known Member
Franke seems to be content letting one of his competitors go billions in debt to remove his main competitor.
CoffeeIcePapers
Well-Hung Member
He has set himself up to where he is indifferent to the outcome. Either way, he eliminates his biggest competitor.
turbojet28
Well-Known Member
Its true that either outcome eliminates his closest competitor, but that doesn’t mean that both options are equally beneficial to the future of the business.
ryan4sail
Well-Known Member
Ye
Is this incorrect?
Yes, but in conjunction with the yes/no vote on frontier, JetBlue is also asking for shareholders to tender their shares to B6. If JetBlue recieves 50% + 1 outstanding shares of spirit by the end of the month (the deadline on the proxy is the 30th I believe), they will essentially have control of the company, thus the “hostile takeover”
Is this incorrect?
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I’ll be the first to admit I know less about the business side, but my understanding about the then June 10 now June 30 vote is it is simply whether to accept or reject the frontier deal. I think the proxy is something else entirely. Any y’all business types please feel free to correct me if I’m wrong.
ryan4sail
Well-Known Member
I’ve done a lot of reading on this, and obviously I’m not an expert by any means, but here is how this works. There are two things going on right now.
1. F9/NK vote. Simple yes or no on merging with frontier.
2. JetBlue is saying “hey, while your at it, why don’t you vote no, AND tender your shares (agree to sell upon closing) to us for 31.50 a share.
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This is my understanding. But I’m not sure how they interface. I think the shareholders could vote down the frontier deal but not necessarily do the tender offer (trying to get frontier to sweeten the pot). To your original question about 50%+1 agreeing to tender, I guess that would be predicated on 50%+1 also voting down the existing deal, which I hadn’t considered when you asked previously (dangers of posting when you’ve woken up at 345 3 days in a row).