By Svea Herbst-Bayliss
BOSTON (Reuters) -Shareholder advisory firm Glass Lewis on Friday recommended Spirit Airlines investors approve Frontier Group Holdings Inc’s $2.9 billion takeover bid, saying it was the “best available” at this time.
The report, which helps guide investors on how to vote on the proposed merger, comes only hours after Frontier said it agreed to a break-up fee as part of a revised deal the companies hope Spirit shareholders will support.
“We believe the Frontier Merger Consideration provides Spirit shareholders with a fairly compelling valuation and premium for their Spirit shares, on balance,” the report said, adding Glass Lewis believed the revised deal terms should offer “added protection” against potential regulatory risk.
Glass Lewis’ report was published days after its larger rival Institutional Shareholders Services urged Spirit shareholders to vote against the deal because Spirit had failed to negotiate a break-up fee.
JetBlue Airways is trying to muscle in on the deal with a hostile $3.3 billion offer that Spirit has rejected.
Glass Lewis wrote that JetBlue had not made a “sufficiently compelling case to warrant overriding the board’s determination” and that the Frontier offer would have an easier path to closing than the JetBlue offer.
(Reporting by Svea Herbst-Bayliss; Editing by Edmund Blair and Mark Potter)
