JetBlue Airways, Spirit Airlines set to face Justice Department lawsuit to block takeover By Investing.com

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JetBlue Airways, Spirit Airlines set to face Justice Department lawsuit to block takeover

Published Mar 06, 2023 13:56

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JetBlue Airways, Spirit Airlines set to face Justice Department lawsuit to block takeover

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By Sam Boughedda

Bloomberg reported Monday afternoon that the Justice Department and Department of Transportation are set to take action to thwart JetBlue Airways' (NASDAQ:JBLU) takeover of Spirit Airlines (NYSE:SAVE).

Citing people familiar with the matter, the publication stated that the Justice Department will file an antitrust lawsuit in federal court, claiming that the $3.8 billion acquisition will result in increased ticket prices and decreased options for travelers.

In a report by The Wall Street Journal, Robin Hayes, CEO of New York-based JetBlue, was quoted as saying that the expectation is "that we will get sued by the DOJ this week."

"My sense is they came to the table with their minds made up," he reportedly added.

Bloomberg added that the Department of Transportation is anticipated to start a parallel proceeding to stop the transfer of Spirit's airline certificate as incompatible with the public interest.

The move would be remarkable in the current era, the Bloomberg report says, as the DOT has not yet used its authority to block certificate transfers since the airline industry was deregulated in 1978.

JetBlue shares are up over 2% following the news, while Spirit has dropped more than 5%.

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