Spirit Airlines Stock Soars As JetBlue Sweetens Takeover Bid to $3.65 Billion

Spirit Airlines shares surged higher Tuesday after JetBlue improved its takeover bid for the low-cost carrier to around $3.65 billion as it looks to elbow-out an agreed merger with Frontier Group Holdings  

JetBlue boosted its cash offer for Spirit to $33.50 per share on Monday, pledging to distribute around $1.50 of that to shareholders immediately upon completion of the deal. 

JetBlue has also pledged to boosts its 'reverse breakup fee' to around $350 million in the event that antitrust authorities fail to approve the merger.  

That risk appears likely, given that the Justice Department has already filed a lawsuit against JetBlue's northeast alliance with American Airlines..

"The Spirit Board of Directors will work with its financial and legal advisors to evaluate JetBlue's revised proposal..

and pursue the course of action it determines to be in the best interests of Spirit and its stockholders," the group said in a statement.   

"Spirit is continuing to engage in discussions with JetBlue and is continuing to work with Frontier under the terms of the existing merger agreement between Spirit and Frontier,"

the statement added. "As part of this process, Frontier and JetBlue have been given access to the same extensive due diligence information, on the same terms."