Spirit Airlines Secures Court Approval to Exit Bankruptcy with $795 Million Debt Restructuring

The restructuring plan converts debt to equity, cancels existing shares, and positions the airline to operate as a private company.

A U.S. bankruptcy judge approved Spirit Airlines' restructuring plan, allowing the company to convert $795 million in debt to equity and emerge from bankruptcy in early 2025.
The plan cancels existing stock shares and transfers ownership to lenders, including Pacific Investment Management Company, UBS Asset Management, and Citadel Advisors.
Spirit Airlines will raise $350 million through new equity shares and issue $840 million in senior secured debt to bondholders.
The airline rejected Frontier Airlines' $2.16 billion merger proposal, citing it as less beneficial to creditors compared to the standalone restructuring plan.
Spirit plans to operate as a smaller airline, focusing on U.S., Caribbean, and Latin American routes, while continuing cost-cutting measures and strategic initiatives.