tiprankstipranks
Spirit Airlines Dividend Denial Crushes Investors’ Spirits
Market News

Spirit Airlines Dividend Denial Crushes Investors’ Spirits

Story Highlights

Many Spirit Airlines investors were looking forward to receiving a sizable payout as the airline merges with JetBlue. However, a bombshell of an update just put a damper on some shareholders’ plans to cash in.

In what was already a disappointing September for investors of Spirit Airlines (SAVE), bad times just got worse as the company’s stock shares suddenly skidded 6%. Reportedly, some investors won’t recieve their expected special dividend from Spirit’s upcoming sale to JetBlue Airways (JBLU).

A few weeks ago, Spirit Airlines scheduled its shareholder vote to move forward with the company’s merger with JetBlue. Moreover, JetBlue’s plan was to buy out Spirit Airlines for $33.50 per share, and that was to include a cash payment of $2.50 per share after Spirit’ stockholders approved the transaction.

Many Spirit Airlines investors had assumed that they wouldn’t need to be a shareholder of record in order to receive a $2.50-per-share special dividend. However, JetBlue disclosed in an after-hours Form 8-K filing that “Shares of Spirit common stock do not trade with a due bill in respect of the approval prepayment.”

Furthermore, a NYSE notice reportedly stated that Spirit Airlines’ investors would need to be holders of record, and would have to be “entitled to vote at the special shareholders meeting,” in order to receive the $2.50-per-share special dividend. The NYSE notice also stated, “Trades made beginning September 9, 2022 are without the value of the ‘approval prepayment amount.'”

It’s a disappointing development for some Spirit Airlines investors who were already dealing with significant share-price declines. The decline just got steeper, and unfortunately some investors won’t even get the consolation prize of the special dividend payout.

Trending

Name
Price
Price Change
S&P 500
Dow Jones
Nasdaq 100
Bitcoin

Popular Articles