Spirit Airlines Ch.11

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10-15-2024 | 05:00 PM

#531

CincoDeMayo

That/It/Thang

Joined: Aug 2020

Posts: 3,500

Likes: 362

Quote:

Originally Posted by APCHCLIMB

ask most spirit or F9 pilots what their engine failure memory items are. That should tell you all you need to know about their investment banking knowledge.

Memory items?

Dude, don’t you even Airbus?

ECAM son. ECAM

10-15-2024 | 05:55 PM

#532

Tranquility

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Joined: Sep 2014

Posts: 1,691

Likes: 21

From: 60’s Tech, Right

Quote:

Originally Posted by CincoDeMayo

Memory items?

Dude, don’t you even Airbus?

ECAM son. ECAM

SATCOM INOP.... WTF is that?! What do we do???..

10-15-2024 | 06:56 PM

#533

hercretired

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Joined: Mar 2021

Posts: 1,768

Likes: 28

Quote:

Originally Posted by APCHCLIMB

ask most spirit or F9 pilots what their engine failure memory items are. That should tell you all you need to know about their investment banking knowledge.

????

enlighten us, what are they

10-15-2024 | 07:28 PM

#534

Ed Force One

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Joined: Apr 2016

Posts: 778

Likes: 16

From: A320 CA

Quote:

Originally Posted by APCHCLIMB

ask most spirit or F9 pilots what their engine failure memory items are.

Man, I can't find *ANYTHING* in these new FCOM thing-a-ma-bobs!

10-15-2024 | 08:30 PM

#535

FriendlyPilot

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Joined: Sep 2020

Posts: 1,591

Likes: 373

Quote:

Originally Posted by CincoDeMayo

Yeah, but this isn’t accurate. Frontier cash on hand is not what will be securing any deal with NK. That’s not how it worked, just like JBLU wasn’t using its cash on hand to purchase NK last year.

Then how are they going to buy Spirit? Take out more debt? What are they waiting for?

10-16-2024 | 05:21 AM

#536

AR1978

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Joined: Apr 2019

Posts: 276

Likes: 1

Quote:

Originally Posted by FriendlyPilot

F9 would have to take NKs $3.3B in debt, including a $1.1B secured debt payment due in less than a year plus another $500M due in 2026. F9 has about $650M cash on hand according to their last 10Q filing. The combined entity would have $7.4B of debt which makes it even more leveraged than American, compared to total revenue. Spirit only has cash on hand because it sold planes this year. NKs debt is rated as "junk" so refinancing it would be at very high interest rates, probably higher than a combined F9/NK profit margin.

If F9 acquired NK as an operating airline it has to cover NKs operating cash outflow problem as well and would likely run out of cash before any merger synergies can be attained.

The best thing F9 can do is see if they can purchase assets in BK at a discount rather than taking on any of that debt. Unfortunately they will have to compete with other airlines that have far more cash for those gates and planes.

Would Frontier had taken on a similar amount of debt if the merger had gone though as planned?

10-16-2024 | 07:16 AM

#537

FriendlyPilot

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Joined: Sep 2020

Posts: 1,591

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Quote:

Originally Posted by AR1978

Would Frontier had taken on a similar amount of debt if the merger had gone though as planned?

The merger announcement with F9 was Februaru 2022. The landscape was substantially different then and NKs financial position is much worse (orders of magniture worse) than it was in early 2022. F9 was buying NK mostly by issuing new stock (with some cash) but NK had almost $1.7B in cash on hand plus access to liquidity and hadn't sold a bunch of planes to generate cash yet. This is from NKs 2021 Annual Statement

"As a result of these actions, as of December 31, 2021, we had $1,679.8 million of liquidity comprised of unrestricted cash and cash equivalents, short-term investment securities and funds available under our revolving credit facility due in 2024"

F9 would have taken that cash to add to its own as part of the merger. B6 was offering a "cash only" purchase, which is better for shareholders because they don't get issued F9 paper which would have been diluted. Also those noted due in 2025 were still over 3 years away and both F9 and NK had ample cash to cover them.

Also NK didn't have a -30% profit margin (loss) and hadn't sold a bunch of planes to keep the operation going.

The situation is MUCH different today than Feb 2022 which was 32 months ago.

Stopping a slow rolling boulder is easy to do, but at this point the boulder is in a freefall and will crush you if you try to catch it.

10-16-2024 | 08:30 AM

#538

Alexjones

On Reserve

Joined: Apr 2024

Posts: 71

Likes: 0

Quote:

Originally Posted by AR1978

Would Frontier had taken on a similar amount of debt if the merger had gone though as planned?

NK probably has underperformed in some
ways since the failed merger attempts and lost a certain amount of value as a business,

those other mergers wanted to go ahead with the debts due.

now they may be able to buy NK for a quarter of the price they offered in 2022 or even less.

Im no economist or expert but it seems like if
done correctly it could be a good deal with F9

bring on the staple

10-16-2024 | 09:33 AM

#539

Nacho Libre

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Joined: Aug 2015

Posts: 317

Likes: 5

From: Underpaid, LCC

Quote:

Originally Posted by Alexjones

ALPA/ALPA so a staple wouldn’t happen. The main points of an SLI are date of hire, relative seniority, and career expectations, and maybe size of company in some cases. If NK/F9 get together it would be some sort of a hybrid of each point. Just an opinion.