Spirit Plummets After Jetblue Warns Deal Is About To Become "Terminable"
After Spirit Airlines plummeted to an all time low last week when the Biden DOJ did Jetblue a favor and blocked the acquisition of the otherwise insolvent airline (with almost $7 billion in debt and half a billion in cash burn), the heavily-shorted Spirit stock staged a miraculous recovery because - as usual - retail investors piled in hoping to spark a squeeze (after all Spirit appealed the ruling so there was some hope) in SAVE stock, a move which was supercharged when that market-top indicator Dave Portnoy decided to come out of daytrading retirement and urged his army of followed to buy the dip.
Unfortunately for those same retail investors, even though we tried to warn them...
Spirit airlines: record high debt, record negative cash flow pic.twitter.com/ehoJRfYrFO
— zerohedge (@zerohedge) January 18, 2024
.... the endgame is looming and it won't be pretty.
Moments ago, SAVE stock plunged after JBLU filed a brief 8K in which it admitted that it has no intention of following through with the doomed deal, saying that...
"certain conditions to closing required by the Agreement and Plan of Merger, dated as of July 28, 2022, among JetBlue, Spirit and Sundown Acquisition Corp., a Delaware corporation, and a direct wholly owned subsidiary of JetBlue (the “Merger Agreement”) may not be satisfied prior to the outside dates set forth in the Merger Agreement (and also informed Spirit that accordingly the Merger Agreement may be terminable on and after January 28, 2024)."
In other words, the company is not only not expecting the deal to close, but it is already preparing to not pay a termination fee, as it will claim that contractual conditions were not met, and thus the entire thing is null and void.
SAVE stock tumbled as much as 12% on the news, before the latest barrage of retail idiots showed up to buy the dip, in doomed hopes of spark a short squeeze when all they are sparking is the fire that will set all their money on fire.
