Jan 26 Reuters JetBlue Airways on Friday expressed doubts over closing its 3.8 billion merger with Spirit Airlines, saying that it might not meet certain conditions required as part of the deal before the due date.
Shares of Spirit tumbled 17 after the announcement, adding to their losses of about 55 this month that were sparked by a U.S. judge39;s move to block the deal.
The airline said it had informed Spirit that the merger agreement might be terminated on and after Sunday due to the unmet conditions.
JetBlue said it continues to evaluate options under the agreement and, unless the agreement is terminated, it would abide by its merger obligations.
In response, Spirit said there was no basis for terminating the merger agreement and it would continue to abide by its obligations and was expecting JetBlue to do the same.
The termination of the deal may deepen the gloom at Spirit. The airline has struggled to post a profit due to increased operating costs and supply chain issues, raising doubts about its ability to pay down debt due to mature next year.
Last week, Spirit said it was assessing options to refinance its 2025 debt maturities, including 1.1 billion debt that was due.
Earlier this month, a U.S. judge blocked the lowcost airline39;s planned merger with JetBlue, after finding that the proposed deal could threaten competition in the U.S. aviation market and harm ticket prices. Both airlines have said they will appeal the ruling.
However, JetBlue is mindful…