Shares of Spirit Airlines soared roughly 35% Wednesday morning on news fellow budget airline Frontier is exploring a renewed bid for one of its closest competitors. While a potential tie-up between the two budget carriers has been floated for months, a new report from the Wall Street Journal suggests a deal may be imminent. Citing people familiar with the matter, the report says the firms have renewed talks at a time when cash-strapped Spirit is struggling to stay afloat in a tough period for low-cost carriers.
Spirit’s shares plunged to record lows after the Journal reported earlier this month that the airline had initiated discussions with bondholders over the terms of a potential bankruptcy filing. The company has since managed to push back its deadline to refinance roughly $1.1 billion in debt, according to a regulatory filing last week. That news caused the stock to rise over 50% on Monday, pushing it back over the $2 mark.
