A federal judge ruled yesterday that JetBlue cannot acquire Spirit Airlines, marking the end of a deal that would have produced the country’s fifth-largest airline behind the Big Four (Delta, American, United, and Southwest).
Judge William Young sided with the Justice Department, which opposed the merger, saying it would harm customers by eliminating a low-cost travel carrier out of the market.
The decision marks a victory for a Justice Department that has aggressively sought to block deals it views as anti-competitive. Attorney General Merrick Garland said in a statement, “Today’s ruling is a victory for tens of millions of travelers who would have faced higher fares and fewer choices had the proposed merger between JetBlue and Spirit been allowed to move forward… The Justice Department will continue to vigorously enforce the nation’s antitrust laws to protect American consumers.”
Shares of Spirit plunged after the ruling, and ended the day down 47%, while JetBlue’s stock gained about 5%.
Spirit’s market capitalization as of Friday’s close was $1.66 billion, less than half of JetBlue’s proposed purchase price of $3.8 billion.
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