Originally Posted by
AutoBrksMedium
This to me seems like pure insanity. BB can’t get the company to grow organically, he couldn’t close a merger deal several times, we lose money more often than we make money (at least on paper) and he is the #1 choice for CEO of a combined airline???
A combined airline needs vision of a new way forward, not just a crappy airline that suddenly got bigger overnight.
Mergers are not a free ride. Acquiring Spirit also means taking their debt.
Alaska had no net debt in 2015 before acquiring VX. In fact they had $600M more cash than debt. After the VX acquisition because of the VX debt and the financing used to buy VX, Alaska had a $2.5B negative net debt. A $3B swing to the negative (the effective cost of the merger). Today Alaska still has a $2.4B negative net debt, even though the merger was almost a decade ago. Alaska is arguably in a worse position today than it was in 2015. That was the cost of "preventing Jetblue from buying VX" which in hindsight would have probably just done the same to Jetblue. Jetblue has now dodged two acquisitions that probably would have made it worse off than it is now.