Spirit announced Friday that it has again filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York as part of a broad restructuring plan.
The ultra-low-cost carrier’s latest bankruptcy filing comes just seven months after it emerged from its previous Chapter 11 restructuring effort in February.
The South Florida-based carrier said the move will give it the tools and flexibility needed to “implement the broad changes necessary to transition the Company for a sustainable future,” according to a news release. Spirit emphasized that flights will continue as scheduled and that customers can still book tickets and use credits and loyalty points during the restructuring process.
Dave Davis, Spirit’s President and CEO, said the decision followed months of discussions with lessors, creditors, and other stakeholders as the airline worked to chart a long-term path forward. “After thoroughly evaluating our options and considering recent events and the market pressures facing our industry, our Board of Directors decided that a court-supervised process is the best path forward,” Davis said.
As part of the restructuring, the ultra-low-cost carrier plans to redesign its route network to focus more heavily on key markets, optimize its fleet size, and pursue further cost efficiencies, it said.
Spirit’s stock is expected to be delisted from the NYSE American exchange as a result of the filing, with shares continuing to trade over-the-counter during the proceedings. The company cautioned that shares are likely to be cancelled and have no value when the restructuring is complete.
The Chapter 11 filing marks Spirit’s second restructuring in recent years. The company previously emerged from a process focused on reducing debt and raising equity capital.
