Us Faa: It Issues Trigger Brief Ground Stop For Frontier Airlines Flights

Consumer stocks were mixed late Wednesday afternoon, with the Consumer Staples Select Sector SPDR Fund (XLP) increasing 0.4% and the Consumer Discretionary Select Sector SPDR Fund (XLY) down 0.1%.

In corporate news, VF said Wednesday that it expects its fiscal Q4 revenue to drop year over year even as the apparel and footwear company's Q3 results unexpectedly increased. Its shares fell 3.7%.

Fox has sold at least 10 of the commercials that would appear during the Super Bowl LIX telecast on Feb. 9 at a higher price, Variety reported. The company charged more than $8 million for 30 seconds of Super Bowl ad time — reportedly a new high. Fox shares rose 0.1%.

Brinker International shares surged nearly 16% after the company boosted fiscal 2025 guidance after reporting stronger-than-expected Q2 results.

Bankrupt budget carrier Spirit Airlines rejected a fresh merger offer from Frontier , saying the proposed terms were "woefully insufficient." Frontier shares rose 5%.

Consumer stocks were rising Wednesday afternoon with the Consumer Staples Select Sector SPDR Fund (XLP) increasing 0.6% and the Consumer Discretionary Select Sector SPDR Fund (XLY) up 0.1%.

In corporate news, Brinker International shares surged 15% after the company boosted fiscal 2025 guidance after reporting stronger-than-expected Q2 results.

Bankrupt budget carrier Spirit Airlines rejected a fresh merger offer from Frontier , saying the proposed terms were "woefully insufficient." Frontier shares rose 6%.

Amazon.com was sued in federal court by consumers accusing the retailing giant of tracking their movements covertly through their cellphones and selling the data it collects, Reuters reported. Amazon shares shed 0.4%.

Bankrupt budget carrier Spirit Airlines rejected a fresh merger offer from Frontier Group , saying the proposed deal terms were "woefully insufficient" from a financial perspective.

The Frontier Airlines parent and Spirit agreed to merge in 2022 but JetBlue swept in with a stronger proposal. JetBlue and Spirit terminated their agreement last March, citing in part concerns that they would not have been able to receive necessary legal and regulatory approvals on time.

Earlier this month, Frontier proposed offering Spirit's debtors and their stakeholders a $400 million principal amount of debt and 19% of Frontier's common equity, Spirit said in a Securities and Exchange Commission filing on Wednesday. The offer also required stakeholders to complete a previously announced $350 million equity rights offering.

In a letter to Frontier dated Tuesday and contained within the SEC filing, Spirit called the latest proposal terms "both inadequate and unactionable."

"Unfortunately, despite the clear guidance we and others have provided for three weeks as to the proposal's many deficiencies, you have addressed virtually none of them," Spirit wrote. The company called it "risky" and "woefully insufficient financially."

Spirit and Frontier restarted negotiations around a possible combination in the summer of 2024, though those talks were discontinued, according to the filing.

Spirit, which filed for Chapter 11 bankruptcy protection in November, said in the Wednesday filing that it expects to complete its restructuring process in the first quarter of 2025 as a deleveraged company that's positioned for long-term success.

In a separate statement, Frontier said its proposal would "provide meaningful value to Spirit financial stakeholders, in excess of Spirit's standalone restructuring plan." The low-cost carrier's shares climbed 5.4% in Wednesday trade.

"We stand ready to continue discussions with Spirit and its financial stakeholders and believe that we can promptly reach agreement on a transaction," said Bill Franke, chair of Frontier's board. Spirit's bankruptcy court filings indicate that the company's standalone plan will "likely result in an unprofitable airline with a high debt load and limited likelihood of success," Frontier said.

By George Glover

Embattled carrier Spirit Airlines rejected a second merger bid from rival Frontier Group on Wednesday — but the renewed efforts to reach a deal could be a sign of what's to come for the aviation industry now that Donald Trump is back in the White House.

Frontier confirmed it had bid for Spirit in a statement early Wednesday. Shortly after, Spirit said in an 8-K form that it would be rejecting the offer.

Under the terms of the offer, Spirit shareholders would receive $400 million in Frontier debt and shares worth a 19% stake in Frontier. Spirit said the proposal would deliver less value for shareholders than its bankruptcy plan, adding that it expects to conclude the restructuring sometime this quarter.

Spirit shares fell 9.2% at Wednesday's market open, while Frontier stock was up 2.1%.

Shares in rival JetBlue Airways slid 1.5%, having cratered 26% Tuesday after the carrier's first-quarter unit revenue guidance came in softer than analysts had expected.

Frontier made its first offer for Spirit in 2022. It was outbid by JetBlue, but a federal judge blocked that merger in early 2024, arguing the deal would harm Spirit's price-sensitive customers.

Even though this latest bid has been rejected, it's a sign that Trump's second term could lead to an airline-industry shake-up. In November, Barron's wrote that a Trump presidency would make the Spirit-Frontier merger process easier, because his administration is expected to ease regulation.

The NYSE Arca Airline Index gauge of airline stocks has risen 9% since Trump won the presidential election on Nov. 5. The benchmark S&P 500 has climbed 6.2% over the same period.

Write to George Glover at george.glover@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.