Spirit Airlines stock fell early Monday after the company and JetBlue announced an agreement to end their nearly $4 billion merger bid. JBLU shares angled higher on the news.
The decision by JetBlue and Spirit Airlines to call off the July 2022 announced $3.8 billion merger comes after President Joe Biden's Justice Department sued to block the combination in March 2023. The Justice Department argued the airline consolidation would reduce competition and increase costs for customers.
Spirit Airlines stock sank 10.6% Monday during market action. Meanwhile JBLU shares angled 4.2% higher.
"We believed this merger was worth pursuing because it would have unleashed a national low-fare, high-value competitor to the Big Four airlines," JetBlue Chief Executive Joanna Geraghty said in a statement Monday.
"We are proud of the work we did with Spirit to lay out a vision to challenge the status quo, but given the hurdles to closing that remain, we decided together that both airlines' interests are better served by moving forward independently," Geraghty added.
JetBlue will pay Spirit Airlines $69 million under the termination agreement.
Last month, a federal district judge in Boston concurred with the Biden administration, agreeing that the proposed merger violated antitrust law.
Last week, the Federal Trade Commission (FTC) sued to block Kroger's $24.6 billion acquisition of the Albertsons supermarket chain as megamergers appear to be facing rising pressure.
SAVE stock has a 4 Composite Rating out of 99, a 3 Relative Strength Rating and a 4 EPS Rating.
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