After one administration blocked Spirit Airlines’ merger in the name of protecting consumers, another may step in to prevent its collapse, lending as much as $500 million in exchange for a warrant to receive an ownership stake in the airline. This is government’s approach to economic policy in a nutshell.
“Maybe the federal government should help that one out,” President Trump said after Spirit Airlines sought an emergency bailout, citing concerns about the potential loss of 14,000 jobs, according to The Wall Street Journal (WSJ). Without government rescue, Spirit would likely have to liquidate, as its creditors object to the new reorganization plan under Chapter 11 bankruptcy. The airline already had to reorganize once—after the Department of Justice (DOJ) won its antitrust case against the Spirit-JetBlue merger.
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