(Reuters) – Frontier Airlines is exploring a renewed bid for Spirit Airlines, the Wall Street Journal reported on Tuesday, citing people familiar with the matter.
The two low-cost airlines have recently held discussions about a possible merger, although discussions are in their early stages and a deal may not come to fruition, according to the WSJ report.
If a deal between Spirit and Frontier were reached, it would likely occur as part of Spirit’s restructuring of debt and other liabilities in the event of bankruptcy, the report added.
Spirit and Frontier did not immediately respond to Reuters’ requests for comment.
Spirit Airlines nearly reached a merger deal with Frontier Group Holdings in 2022, the parent company of Frontier Airlines, which ended after JetBlue won the bidding war for Spirit.
The report comes as Spirit faces an uncertain future following the collapse of its $3.8 billion merger deal with JetBlue Airways after the merger was blocked in March by the U.S. Department of Justice.
The Journal reported earlier in the month that Spirit was in talks with bondholders over terms of a possible bankruptcy filing following its failed merger with JetBlue.
Spirit has lost money despite strong travel demand and failed to report a profit in five of the last six quarters, raising doubts about its ability to manage looming debt maturities.
The ultra-low-cost carrier announced last week that it had reached an agreement with its credit card processor, US Bank National Association, to extend its debt refinancing deadline by two months, until December 23 .
(Reporting by Rishabh Jaiswal in Bangalore; editing by Rashmi Aich and Alan Barona)
