Republic has won the bidding for bankrupt Frontier Airlines, beating out Southwest.
Republic improved its initial $108.75 million offer, removing pre-closing conditions and receiving antitrust clearance as part of submitting what was deemed the best offer for the bankrupt Frontier.
The other suitor, Southwest Airlines, said its refusal to remove a labor condition from its proposal was key in the decision by Frontier’s creditors that Southwest’s $170 million bid was unacceptable.
Republic also agreed to waive distributions on a $150 million claim, which is expected to result in a 94 percent increase in the distribution to Frontier’s general unsecured creditors.
The Frontier brand, the tail decor, and the employees will be kept intact.
One of the elements that hurt the Southwest bid was that the Southwest pilots wanted seniority over the Frontier ones, while the Frontier ones wanted to be matched based on seniority. The two unions reached an impasse, and Southwest insisted that their bid was contingent on an agreement. However, the Frontier pilots will still have to negotiate with the Republic pilots for similar stakes.
I wouldn’t have minded Southwest winning, but I’ll agree it’s nice that the animals will still be around. And it’s probably best for all concerned (or at least Denver residents) that we have three competitive airlines in town, rather than just two. Especially if it provides two alternatives to United.
I can’t agree more. I love Frontier, and I’m glad they’ll remain (mostly) intact!
I was preparing to mourn the loss of the animals! Plus I like competition in town.
Dave, actually, since Republic is just a holding company, and Frontier will continue to be Frontier, there is no union issues for Republic to deal with, that is why they thankfully won.
Actually, Republic flies for other airlines. This is the first airline they actually own.