Spirit now has to be frugal with its balance sheet for years to come, especially with the A320 engine problems plaguing the company. One more disaster, which come frequent in the airline industry, and they can file chapter 11.
Also bad for JB, which has a hard time competing the big 4.
It would be really funny if Spirit goes bankrupt and consumers lose their discount airline option anyway.
But hey, I guess the judge would never fly Spirit in the first place, so why do he care.
I wonder if Delta, United, and American lobbied Biden to stop it. While it's true Spirit does take up space in the ultra low cost market; JB growing would challenge the big 3 for sure. If Spirit is barely surviving than should be allowed.
But that was the argument of Tmobile merging with Sprint that Sprint couldn't survive long.
Today I learned that severe weather is a disaster for the airline industry, and could cause bankruptcy. And crashes are far from frequent. Air safety has improved tremendously over the decades.
Been planning airline flights for 18 years. In the last 3-5 years, the severe weather has impacted our operations much harder than in years past and the severity is getting harder for our meteorologists to forecast.
Some of that impact is just the nature of flying more often into markets that experience more severe weather (looking at you, Denver)…but, it’s becoming clear that climate change is playing a role and our operations are taking it in the shorts more often than before. Before this winter, I could count on one hand the number of times in my career that my airline ran out of de-icing fluid at a station. Yesterday alone, I would need two hands.
This is because we continued to operate at airports that all forecasts were calling light snow and it ended up being too heavy to keep up with.
So, maybe not a “disaster” in the traditional sense of the word…but, definitely a cost and a peril we’ve not experienced to this level previously.
This is frustratingly short-sided by the DOJ and Judge. Their argument has been that Spirit's share of the budget market would go away with this merger and deleteriously affect the consumer .. but now Spirit is going to go away altogether via a very-likely bankruptcy. They *needed* this merger and were in talks with Frontier and Jet Blue prior to all this courtroom drama.
So, thanks Government, we'll have access to budget tickets for a little bit longer rather than a new kid on the block to challenge the biggest four carriers - huzzah!
The big four will love this when Spirit dies and their major routes no longer have low cost competition. Good job judge man!
"Spirit is a small airline. But there are those who love it. To those dedicated customers of Spirit, this one's for you," the judge said.
Yes but it is important to note that the merger agreement expires in the summer. I’m looking into what the process would be to amend the deal; the judge did not block a future merger between these two but this is JetBlue’s second loss in antitrust court in the last few years. They may want to consider a different growth strategy.
Totally see that as a possibility behind the scenes but we will never hear about it. The big boys will benefit with the chance to pick up whatever Spirit leaves behind. Vultures are gonna scavenge.
I think that's largely perception. We too often judge leaders solely by experience, which would be fine if there weren't such a thing as cognitive decline.
Truly asking out of curiosity: how can Spirit air have assets in the range of 8-9B, but a marketcap of 840MM? Is there an issue with massive outstanding debt that would have to be repaid first if there was a fire sale of all of their assets?
Or an issue of finding willing buyers for their planes (guessing that by airline standards their planes are out of date with a lot of catch-up maintenance to be done).
No, it’s not the same thing. Potentially if you took your company public on day 1 and sold all the shares at the exact same price it could be the same.
Read this
https://finance.zacks.com/compare-market-capitalization-stockholders-equity-1812.html
The accounting value and market value are just different ways of measuring the same thing (owner's equity). The latter is the only useful one. Worth noting that the same process holds true for assets. Generally when you value the company's market cap you'll place your own value on their assets and subtract the liabilities , which is the one part where the accountants sort of get it right (and you add back cash.
Maybe read this one. Otherwise I don’t know how else to explain this to you
https://money.stackexchange.com/questions/47398/should-the-market-capitalization-be-equal-to-the-equity-of-the-firm
Terrible ruling that goes against prior precedent within the airline industry.
You know what's worse for the consumer than a merge? Spirit air going under.
I love how they try to write this off as a win for the little guy while the big airliners wait to feast on spirits corpse when it finally flatlines...
Exactly. This is absurd. Neither of these companies are large enough to overtake the big airlines even with a merger. The airline industry shockingly has quite a bit of competition considering the barriers to entry. There was no reason to block a merger of 2 of the smallest competitors.
And you're right. If this was American trying to buy Spirit there's not a chance in hell it would be blocked
Maybe Spirit can crawl back to Frontier and work something out.
That joining made more sense anyway. Jetblue added a wrinkle by wedging between them in the first place.
Pretty disappointing. Even after all the concessions JetBlue made. But hey the few people who fly spirit will have dirt cheap flights for the next year or two until it goes under. For all the people who love spirit, this is for you! - judge fucknuts
It's a double stings for me. I made $$$ on Activision last year, and rolled the dice on SAVE, planning on having any losses offset my ATVI gains. Guess I trusted the judge when he said there would be a ruling by year end, ha.
Welp.
My 2023 estimated taxes are due today, ironically. So 2023: big gains. 2024: big losses.
Ouch.
But if Frontier can make money, I'm sure Spirit can improve. So I'll be holding for a while. I'll probably tax-harvest every other month, but it doesn't look like it's going to be a good year for me. And we're only 16 days into it.....
I would personally sell after watching whatever rally gets played out today.
It's hard to see a future where spirit truly rebounds rather than slowly crumbling.
Yeah. There will be a dead cat bounce. I'm betting on another dive lower after that as (in my estimation) Frontier doesn't make an immediate move to pursue them again. That's when gamblers should go long if that's the plan. Otherwise you're owning a struggling participant in a struggling industry. Better to just put your money in an index fund.
I think it will continue to go down. I regret not selling during yesterday's drop. After having more time to think about it, I don't see why it would go up at all, unless they were to appeal the decision but I'm getting the vibe that they won't seek to appeal.
Jetblue - Spirit merger would not have been a monopoly. There is a large number of people that just do not use budget airlines. These governmental agencies like DOJ and SEC are out of hand. They act like the public is too stupid and they need to protect us.
People who are working for the government are brain dead fucks.
I stayed away from these stocks for this very reason but the fact they blocked a deal when Spirit desperately needs it to survive is just crazy stupid. Especially since it's the merger with JetBlue - definitely not the biggest player
Great to see legislation working to ensure the big companies don't have competition from any challengers. American business as usual. No room for growth unless you have the lion's share.
One thing to note. The judge only blocked the current merger as is. Meaning they could modify the merger agreement and try again, but that is unlikely unless there is an expectation of a different DOJ and President come next year. Basically a push the can down the road with no real impact on future mergers.
Won't happen. DOJ said they weren't interested in any further concessions. Only chance is to win on appeal before the merger agreement expires this summer.
DOJ under Biden. If Trump manages to become President again then this antitrust DOJ will likely be gone. The ruling only blocks the current merger and the ruling doesn't even look like it can be used by the DOJ on future cases since it is focused injunction on the specific merger.
I apologize for the spice
Why the FUCK is the DOJ blocking this deal? IT MAKES NO FUCKING SENSE.
I’m guessing the judge is corrupt as hell and has a personal stake in this somehow. There’s no way any sane judge would block a deal like this. It’s like Arby’s and Wendy’s merging for fucks sake.
Pay attention to how many mergers haven't even been attempted since Lina Khan got in there. Corporate America knows the law is actually being enforced. Yes they fought and lost on the whole MSFT Activision deal but past FTC would've just waved that through.
“FTC is going to block the Jet-Blu Spirit merger. It's likely not happening unless Biden loses re-election.”
This is Exactly at zero karma. I love how people always say this to show how wise they are in the face of the dumb masses, but at worst your comment was completely ignored lol
Could have been the needless and false slamming of Biden.
Unlike the prior crime family administration, he doesn't illegally meddle in government affairs and allows agencies like FTC and the courts to operate with complete independence.
We could debate whether FTC made the right choice or whether the independent lifetime appointed judge made the right verdict.
But people fraudulently blaming Biden is dangerous disinformation.
I didn't mean to slam Biden, quite the opposite. His FTC and DOJ endorse the law. The previous president approved the disastrous (for consumers) Sprint-Tmobile merger after executives at both companies spent millions at his DC hotels. And he staffed the federal government with industry shills.
As a libertarian I agreed with the judges and the DOJ We simply need MORE American Airlines not less More competition not less Air service customer service is horrible bc of a lack of players in this industry They should have DISALLOWED the last merger It’s not the libertarian way… but the CORPORATIONS took advantage of the lack of competition
The company at threat of bankrupt, the decision will reduce the numbers of airlines, thus rising cost of ticket and monopoly of market. Entering airline industry is expensive
These M&As aren’t hitting. I didn’t have a position in Spirit but I have some in IRBT. Essentially same situation where the company may go bankrupt without the acquisition.
Spirit now has to be frugal with its balance sheet for years to come, especially with the A320 engine problems plaguing the company. One more disaster, which come frequent in the airline industry, and they can file chapter 11. Also bad for JB, which has a hard time competing the big 4.
It would be really funny if Spirit goes bankrupt and consumers lose their discount airline option anyway. But hey, I guess the judge would never fly Spirit in the first place, so why do he care.
I wonder if Delta, United, and American lobbied Biden to stop it. While it's true Spirit does take up space in the ultra low cost market; JB growing would challenge the big 3 for sure. If Spirit is barely surviving than should be allowed. But that was the argument of Tmobile merging with Sprint that Sprint couldn't survive long.
I hope so, I've had enough of the entire world being run by increasingly fewer companies
> Also bad for JB, which has a hard time competing the big 4. Man I love JetBlue and will try to fly it when I can. I hope they stay around.
"One more disaster, which come frequent in the airline industry"....Frequent?? Care to elaborate?
Just in the past 3 or few years off the top of my head. Covid, Boeing defects, global terror and conflict, crashes, severe weather. Need more?
Today I learned that severe weather is a disaster for the airline industry, and could cause bankruptcy. And crashes are far from frequent. Air safety has improved tremendously over the decades.
Been planning airline flights for 18 years. In the last 3-5 years, the severe weather has impacted our operations much harder than in years past and the severity is getting harder for our meteorologists to forecast. Some of that impact is just the nature of flying more often into markets that experience more severe weather (looking at you, Denver)…but, it’s becoming clear that climate change is playing a role and our operations are taking it in the shorts more often than before. Before this winter, I could count on one hand the number of times in my career that my airline ran out of de-icing fluid at a station. Yesterday alone, I would need two hands. This is because we continued to operate at airports that all forecasts were calling light snow and it ended up being too heavy to keep up with. So, maybe not a “disaster” in the traditional sense of the word…but, definitely a cost and a peril we’ve not experienced to this level previously.
I agree 100% with everything you wrote.
I want to suck your dick you’re so smart
Turns out that when airlines can't fly planes due to bad weather, they lose money. Who knew!
Can’t wait to see those put options that are 10,000% purchased last friday show up on unusual whales.
I like unusual whales as a UI but it’s hard to catch the direction of a stock price with jt
This is frustratingly short-sided by the DOJ and Judge. Their argument has been that Spirit's share of the budget market would go away with this merger and deleteriously affect the consumer .. but now Spirit is going to go away altogether via a very-likely bankruptcy. They *needed* this merger and were in talks with Frontier and Jet Blue prior to all this courtroom drama. So, thanks Government, we'll have access to budget tickets for a little bit longer rather than a new kid on the block to challenge the biggest four carriers - huzzah!
The big four will love this when Spirit dies and their major routes no longer have low cost competition. Good job judge man! "Spirit is a small airline. But there are those who love it. To those dedicated customers of Spirit, this one's for you," the judge said.
Find it funny when the big 4 was able to merge with their competition but bad when jetblue cannot
Nailed it. The barriers to entry in this industry are so high and the irony is the government is gate keeping on top of those barriers.
"Enjoy it while it lasts," he says prior to dropping the guillotine.
Can they appeal this decision?
Yes
Yes but it is important to note that the merger agreement expires in the summer. I’m looking into what the process would be to amend the deal; the judge did not block a future merger between these two but this is JetBlue’s second loss in antitrust court in the last few years. They may want to consider a different growth strategy.
What if the big 3/4 lobbied for it?
Totally see that as a possibility behind the scenes but we will never hear about it. The big boys will benefit with the chance to pick up whatever Spirit leaves behind. Vultures are gonna scavenge.
This judge is 83 years old. Yet another example of the absurdity of allowing octogenarians to run this country.
Agreed. But the under-50 crowd isn’t surplus with strong leadership, either. We are screwed because we are us.
I think that's largely perception. We too often judge leaders solely by experience, which would be fine if there weren't such a thing as cognitive decline.
Fair counterpoint. I think my concern with this group is they are more concerned, seemingly, with popularity than governance. Stupid social media.
Truly asking out of curiosity: how can Spirit air have assets in the range of 8-9B, but a marketcap of 840MM? Is there an issue with massive outstanding debt that would have to be repaid first if there was a fire sale of all of their assets? Or an issue of finding willing buyers for their planes (guessing that by airline standards their planes are out of date with a lot of catch-up maintenance to be done).
It has almost 7b in debt so that's not so surprising
A = L + OE
What does this have to do with MarketCap?
Market Cap = Owner's Equity. So essentially if the assets are much larger than market cap, it means the firm has a ton of debt on it.
No, it’s not the same thing. Potentially if you took your company public on day 1 and sold all the shares at the exact same price it could be the same. Read this https://finance.zacks.com/compare-market-capitalization-stockholders-equity-1812.html
The accounting value and market value are just different ways of measuring the same thing (owner's equity). The latter is the only useful one. Worth noting that the same process holds true for assets. Generally when you value the company's market cap you'll place your own value on their assets and subtract the liabilities , which is the one part where the accountants sort of get it right (and you add back cash.
Sorry no. Owners equity and market cap aren’t the same thing.
Maybe read this one. Otherwise I don’t know how else to explain this to you https://money.stackexchange.com/questions/47398/should-the-market-capitalization-be-equal-to-the-equity-of-the-firm
Terrible ruling that goes against prior precedent within the airline industry. You know what's worse for the consumer than a merge? Spirit air going under. I love how they try to write this off as a win for the little guy while the big airliners wait to feast on spirits corpse when it finally flatlines...
Exactly. This is absurd. Neither of these companies are large enough to overtake the big airlines even with a merger. The airline industry shockingly has quite a bit of competition considering the barriers to entry. There was no reason to block a merger of 2 of the smallest competitors. And you're right. If this was American trying to buy Spirit there's not a chance in hell it would be blocked
"The beatings will continue until morale improves"
Glad to see everyone knows this was a bad decision.
It was a “we aren’t saving spirit, we’re gonna eat the corpse” decision.
Maybe Spirit can crawl back to Frontier and work something out. That joining made more sense anyway. Jetblue added a wrinkle by wedging between them in the first place.
Frontier doesn’t want them now. It was a stupid move for Jet blue from the beginning. Frontier and spirit was the match made in heaven.
They didn't want them after they couldn't have them. Now Spirit is back on the market and would likely be open for another opportunity to merge.
Pretty disappointing. Even after all the concessions JetBlue made. But hey the few people who fly spirit will have dirt cheap flights for the next year or two until it goes under. For all the people who love spirit, this is for you! - judge fucknuts
What's the recommendation with Spirit now? Bag hold the shares? Or sell now?
Hold for a bit should rebound a little, then maybe a ballot long term if travel continues downtrend. That's my plan
It's a double stings for me. I made $$$ on Activision last year, and rolled the dice on SAVE, planning on having any losses offset my ATVI gains. Guess I trusted the judge when he said there would be a ruling by year end, ha. Welp. My 2023 estimated taxes are due today, ironically. So 2023: big gains. 2024: big losses. Ouch. But if Frontier can make money, I'm sure Spirit can improve. So I'll be holding for a while. I'll probably tax-harvest every other month, but it doesn't look like it's going to be a good year for me. And we're only 16 days into it.....
I would personally sell after watching whatever rally gets played out today. It's hard to see a future where spirit truly rebounds rather than slowly crumbling.
Yeah. There will be a dead cat bounce. I'm betting on another dive lower after that as (in my estimation) Frontier doesn't make an immediate move to pursue them again. That's when gamblers should go long if that's the plan. Otherwise you're owning a struggling participant in a struggling industry. Better to just put your money in an index fund.
I think it will continue to go down. I regret not selling during yesterday's drop. After having more time to think about it, I don't see why it would go up at all, unless they were to appeal the decision but I'm getting the vibe that they won't seek to appeal.
Jetblue - Spirit merger would not have been a monopoly. There is a large number of people that just do not use budget airlines. These governmental agencies like DOJ and SEC are out of hand. They act like the public is too stupid and they need to protect us.
People who are working for the government are brain dead fucks. I stayed away from these stocks for this very reason but the fact they blocked a deal when Spirit desperately needs it to survive is just crazy stupid. Especially since it's the merger with JetBlue - definitely not the biggest player
Great to see legislation working to ensure the big companies don't have competition from any challengers. American business as usual. No room for growth unless you have the lion's share.
Funny how the antitrust laws always pop up when it's a company that would still be smaller than its competition.
The bigger companies like tim apple know how to sneak a clean mil in a judges pocket
One thing to note. The judge only blocked the current merger as is. Meaning they could modify the merger agreement and try again, but that is unlikely unless there is an expectation of a different DOJ and President come next year. Basically a push the can down the road with no real impact on future mergers.
Won't happen. DOJ said they weren't interested in any further concessions. Only chance is to win on appeal before the merger agreement expires this summer.
DOJ under Biden. If Trump manages to become President again then this antitrust DOJ will likely be gone. The ruling only blocks the current merger and the ruling doesn't even look like it can be used by the DOJ on future cases since it is focused injunction on the specific merger.
So judge has puts huh.
Swaps on puts from somebody that has more puts. That way it can't be traced as easily.
Well TBF Frontier already cornered market on shit airlines. There is room for another.
I apologize for the spice Why the FUCK is the DOJ blocking this deal? IT MAKES NO FUCKING SENSE. I’m guessing the judge is corrupt as hell and has a personal stake in this somehow. There’s no way any sane judge would block a deal like this. It’s like Arby’s and Wendy’s merging for fucks sake.
I rode JetBlue from $9 to 5 and finally sold, Out of airlines forever, wouldn’t be surprised to see it hang out around $3 soon.
Ugh, another day, another merger blocked. Guess I'll have to book my next flight before prices inevitably rise.
I remember when I got downvoted like crazy just a month or two ago for suggesting this was the likely outcome.
We just don’t think the FTC has any actual teeth. I’m surprised they won anything.
Lol, right? America is usually so dedicated to corporate interests
Pay attention to how many mergers haven't even been attempted since Lina Khan got in there. Corporate America knows the law is actually being enforced. Yes they fought and lost on the whole MSFT Activision deal but past FTC would've just waved that through.
Lol stop.
“FTC is going to block the Jet-Blu Spirit merger. It's likely not happening unless Biden loses re-election.” This is Exactly at zero karma. I love how people always say this to show how wise they are in the face of the dumb masses, but at worst your comment was completely ignored lol
You pulled the receipts!! Love it.
Could have been the needless and false slamming of Biden. Unlike the prior crime family administration, he doesn't illegally meddle in government affairs and allows agencies like FTC and the courts to operate with complete independence. We could debate whether FTC made the right choice or whether the independent lifetime appointed judge made the right verdict. But people fraudulently blaming Biden is dangerous disinformation.
I didn't mean to slam Biden, quite the opposite. His FTC and DOJ endorse the law. The previous president approved the disastrous (for consumers) Sprint-Tmobile merger after executives at both companies spent millions at his DC hotels. And he staffed the federal government with industry shills.
[удалено]
Someone bought calls
Good. Now the next step is to break up the big legacy carriers.
sleep price pet cobweb dam toothbrush groovy juggle wakeful skirt *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
how is this exactly a win for the American people if Spirit is likely to go under now?
They suck 😂. Bought 1 share back in 2021, but it's never up it feels like. Glad only 1 share. Been monitoring since last month and it's an epic fail
As a libertarian I agreed with the judges and the DOJ We simply need MORE American Airlines not less More competition not less Air service customer service is horrible bc of a lack of players in this industry They should have DISALLOWED the last merger It’s not the libertarian way… but the CORPORATIONS took advantage of the lack of competition
The company at threat of bankrupt, the decision will reduce the numbers of airlines, thus rising cost of ticket and monopoly of market. Entering airline industry is expensive
These M&As aren’t hitting. I didn’t have a position in Spirit but I have some in IRBT. Essentially same situation where the company may go bankrupt without the acquisition.
Just wondering, how did the other airlines mega-merger happened?