Judge blocks JetBlue-Spirit merger after DOJ's antitrust challenge
A federal judge blocked JetBlue Airways' purchase of budget rival Spirit Airlines after the Justice Department sued to stop the merger, alleging it would drive up fares for some of the most price-sensitive consumers.
JetBlue's proposed $3.8 billion purchase of discounter Spirit would have produced the country's fifth-largest airline, a deal the carriers said would help them better grow and compete against larger rivals like Delta and United.
"JetBlue plans to convert Spirit's planes to the JetBlue layout and charge JetBlue's higher average fares to its customers," U.S. District Court Judge William Young wrote in his decision. "The elimination of Spirit would harm cost-conscious travelers who rely on Spirit's low fares."
The decision, handed down Tuesday, marks a victory for a Justice Department that has aggressively sought to block deals it views as anticompetitive.
The DOJ alleged in its lawsuit, filed in March, that JetBlue's acquisition of the budget airline would force "tens of millions" of passengers to pay higher fares by eliminating Spirit and "about half of all ultra-low-cost airline seats in the industry."
Spirit shares plunged after the ruling and were down more than 50%, while JetBlue's stock gained about 5%.
JetBlue and Spirit said in a joint statement that they disagreed with the ruling and were evaluating next steps.
"We continue to believe that our combination is the best opportunity to increase much needed competition and choice by bringing low fares and great service to more customers in more markets while enhancing our ability to compete with the dominant U.S. carriers," the carriers said.
A different U.S. District Court judge in Massachusetts sided with the Justice Department last year to block JetBlue's