(NewsNation) — Shareholders approved the merger agreement between Spirit and JetBlue on Wednesday morning, according to a press release from Spirit Airlines.
The release said that based on preliminary voting results, more than 50% of the outstanding shares of Spirit Airlines voted in favor of the transaction.
“This is an important step forward on our path to closing a combination that will create the most compelling national low-fare challenger to the dominant U.S. carriers. We look forward to continuing our ongoing discussions with regulators as we work toward completing the transaction and delivering value to Team Members, Guests and stockholders,” the president and CEO of Spirit Airlines Ted Christie said.
The merger could create the nation’s fifth-largest carrier, but still needs to be approved by the federal government.
NewsNation business contributor Lydia Moynihan explained that the merger could create the fifth-largest carrier that would be able to compete with the four other massive carriers: United, Southwest, Delta and American, which currently have 75% market share.
“They’re (Spirit/JetBlue) saying they would bring a budget price and a budget airline to many more people by being able to combine pilots, planes and routes. So that is their promise. Shareholders are expected to approve this deal. But the real question, of course, is whether or not the Biden administration is going to approve this deal,” Moynihan said.
The Biden administration has been very vocal about saying it’s going to oppose any deal due to fear it could actually raise prices, she explained. The White House‘s argument is that once you have fewer competitors, prices will go up.