JetBlue Airways said on Friday that it might back out of a $3.8 billion acquisition of Spirit Airlines after a federal judge blocked the deal.
The announcement came just a week after JetBlue and Spirit had said they would appeal the decision, which was made in an antitrust case brought by the Justice Department.
In a regulatory filing on Friday, JetBlue said the deal could be terminated after Sunday if certain conditions weren’t met. Spirit said in its own filing that it disagreed with JetBlue and believed “there is no basis for terminating” the deal.
A federal judge in Boston blocked the proposed merger on Jan. 16, ruling that Spirit plays an important role in keeping airline fares low and that a takeover by JetBlue would hurt travelers. The ruling was a win for the Justice Department, which under President Biden has sought to limit corporate consolidation across the economy.
The agreement has an expiration date of Jan. 28, and if certain conditions are met that date is automatically extended to July 24. JetBlue appears to be arguing that Spirit has not met its end of the bargain, allowing JetBlue to walk away from the deal on or after Sunday.
As part of the merger agreement, JetBlue agreed to pay Spirit and its shareholders a combined $470 million if regulators blocked the deal.
