From Fortune:

A federal judge blocked JetBlue’s $3.8 billion acquisition of Spirit Airlines, citing concerns of stifled competition and raised fares. Spirit’s shares plunged 47%, while JetBlue spiked 11% after the news. The ruling marks a win for the Biden administration’s antitrust enforcers and a major rebuff to JetBlue’s growth strategy. The airlines contend that consolidation is necessary for smaller carriers to compete effectively.

The judge’s decision follows a closely watched trial, where the government argued that the merger would eliminate incentives for bigger airlines to offer budget-friendly fares. JetBlue’s planned divestitures to low-cost carriers were deemed insufficient to replace the competition that would be lost. The federal government sued to block the deal in March, signaling a crackdown on industry consolidation.

The ruling represents a major setback for JetBlue and Chief Executive Officer Robin Hayes, who saw the acquisition as the best way to grow quickly and affect pricing by industry leaders. The company had seen a similar defeat in a federal antitrust challenge last year regarding its Northeast Alliance with American Airlines. The final outcome of this decision could reshape the competitive landscape for low-cost carriers in the US.



Read more: JetBlue’s $3.8 billion acquisition of Spirit Airlines blocked by judge in antitrust trial