Spirit Airlines stock rallies after ISS recommends shareholders reject Frontier buyout bid

Shares of Spirit Airlines Inc. rallied 2.4% in midday trading while JetBlue Airways Corp. was little changed, after after independent proxy advisor Institutional Shareholder Services (ISS) recommended Spirit shareholders reject the buyout deal with Frontier Group Holdings Inc. . Meanwhile, Frontier shares climbed 2.2%. The ISS recommendation comes after Spirit said recently that it’s board of directors unanimously determined JetBlue’s bid was not in the airline’s shareholders’ best interest, and urged the shareholders to reject JetBlue’s tender offer. “ISS highlighted that a deal with JetBlue will bring more value and cash certainty,” said JetBlue Chief Executive Robin Hayes. “We believe it is clear a combined JetBlue-Spirit will bring more competition with the Big Four airlines driven by the power of the JetBlue Effect, supporting our conviction that we can achieve regulatory approval for our transaction.” Spirit shares have slipped 4.0% year to date, while JetBlue’s stock has dropped 23.8%. In comparison, the U.S. Global Jets ETF has ticked down 2.4% this year and the S&P 500 has dropped 12.8%.

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