Spirit to Exit Bankruptcy

The U.S. Bankruptcy Court for the Southern District of New York authorized Spirit’s plan to exit bankruptcy on Thursday.

According to a report by Bloomberg, the airline has made a “lender-backed take-private deal” that will give control of the ultra-low-cost carrier to top bondholders. Court documents show that the group includes Citadel Advisors, Pacific Investment Management Co. and Western Asset Management Co.

Bloomberg reported that the restructuring deal approved by Judge Sean Lane on Thursday “was widely supported by Spirit lenders.”

The deal comes a little over a week after the carrier rejected Frontier’s latest offer to merge with Spirit.

The airline filed for Chapter 11 bankruptcy in November 2024 after years of quarterly losses and growing debt.

While bondholders might be happy with the new deal, shareholders have been vocal critics of the airline and its leadership. In December, over a dozen shareholders sent letters to Judge Lane lambasting Spirit CEO Ted Christie or board members for the Chapter 11 filing and for supporting a deal that would cancel their shares.

One investor went as far as to create their own website mocking the company and its CEO.

AirlineGeeks reached out to Spirit for comment.

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