Four states join US bid to stop JetBlue-Spirit merger
JetBlue and Spirit announced the intention to combine last year in a $3.8 billion deal that would create the fifth-largest airline
Four states have joined the U.S. Justice Department lawsuit aimed at preventing JetBlue Airways from buying rival discount carrier Spirit Airlines for $3.8 billion.
California, Maryland, New Jersey, and North Carolina signed the lawsuit Friday, which was filed in early March.
They join Massachusetts, New York, Connecticut and the District of Columbia in the litigation.
"We look forward to litigating this important case alongside our state law enforcement partners to stop JetBlue from eliminating its rival, Spirit," said DOJ Principal Deputy Assistant Attorney General Doha Mekki said in a statement.
DOJ SUES TO BLOCK $3.8B JETBLUE-SPIRIT AIRLINES MERGER
The U.S. Justice Department filed the lawsuit on March 7, seeking to stop the transaction.
The DOJ says the merger would lead to higher fares, fewer seats and harming consumers.
"It’s unfortunate that these states have decided to join the DOJ’s effort to protect the dominant position of the four largest airlines in the U.S. The facts show that preserving the status quo is the most anti-competitive step that the federal government and these states can take,' said a JetBlue in a statement to FOX Business. "We look forward to arguing the merits of this combination in court, and are confident the court will find that consumers will benefit from the increased competitive effect that JetBlue uniquely brings to the routes we fly".
FOX Business has reached out to Spirit Airlines for comment.
JETBLUE, SPIRIT INSIST MERGER WON'T LEAD TO HIGHER AIRLINE FARES, AS DOJ CIRCLES
JetBlue and Spirit agreed to combine last year in a $3.8 billion deal that aims to create the fifth-largest airline in the U.S.
The merged airlines would have an estimated 9% of market share.
JetBlue CEO Robin Hayes defended the deal in a Reuters interview this month, saying it would save consumers money and boost available seats.
SPIRIT AIRLINES BRINGING IN 4,000 PILOTS, FLIGHT ATTENDANTS, OTHER TEAM MEMBERS THIS YEAR
JetBlue has said that buying Spirit is its best chance of growing large enough to credibly challenge the four largest airlines that combined have 80% of the market.
|SAVE||SPIRIT AIRLINES INC.||15.72||+0.34||+2.21%|
|JBLU||JETBLUE AIRWAYS CORP.||7.42||+0.02||+0.27%|
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President Biden has been pushing back against further consolidation in industries dominated by a few powerful companies.
Reuters contributed to this report.