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Following a blockbuster deal caused by antitrust problems, JetBlue and Spirit decided to abandon the acquisition.

Following a blockbuster deal caused by antitrust problems, JetBlue and Spirit decided to abandon the acquisition.

JetBlue Airways and Spirit Airlines announced the official termination of their planned $3.8 billion merger on Monday.
This comes after a U.S. judge in January blocked the deal due to concerns that it would stifle competition in the airline industry.
The proposed merger, if successful, would have created the fifth-largest airline in the United States and helped ensure Spirit’s financial stability.
However, the potential for reduced competition and higher ticket prices for consumers raised red flags for the Biden administration, leading to the lawsuit challenging the deal.
With the court ruling and the continued opposition from the Department of Justice, both airlines concluded that pushing forward with the merger was not feasible. Under the termination agreement, JetBlue will pay Spirit $69 million.
The collapse of the deal leaves Spirit facing significant challenges. The company is already grappling with weak demand in its core markets and needs to find alternative strategies to achieve long-term financial stability.
Some analysts even suggest the possibility of bankruptcy if Spirit cannot improve its financial situation.
Meanwhile, JetBlue is focusing on other initiatives to boost its revenue and achieve cost savings. These efforts include raising baggage fees and implementing cost-cutting programs.
The decision to abandon the merger marks a victory for the Biden administration’s stance against anti-competitive practices in the airline industry.
The administration has been actively using antitrust laws and other measures to promote lower prices for consumers across various sectors.SOURCE: JetBlue and Spirit Abandon Merger After Antitrust Concerns Block Deal BY: eTurboNews | eTN  

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