Category Archives: Indigo Partners

Frontier Airlines is now owned by Indigo Partners

Frontier Airlines (2nd) (Denver) as of yesterday (December 3) is now owned by Indigo Partners through an affiliate. Indigo Partners issued this statement:

Indigo Partners has announced that, through an affiliate, it has completed the acquisition of Frontier Airlines from Republic Airways Holdings on December 3, 2013. Final terms of the transaction, which was first announced on October 1, 2013, are not being disclosed.

Indigo Partners and its principals, led by managing partner William A. Franke, have considerable experience in successful, airline-related investments.

“Today is an exciting day for Frontier Airlines and Indigo Partners, as we can now embark on a new chapter in Frontier’s history of providing safe, reliable and fairly priced air service,” said Franke. “As air travel costs have moved higher, demand has grown for more affordable options and more choices. One key element to Frontier’s future success will be operating as an ultra low cost carrier that offers low fares. This model, coupled with the Frontier touch, will ensure opportunities for the Frontier team, and provide safe and reliable ULCC air service to our communities and beyond as we grow Frontier under this vision.”

Frontier will remain headquartered in Denver, Colorado.

David Siegel, CEO and President of Frontier Airlines, resigned from Republic’s Board of Directors.

Indigo Partners is a private equity firm established by W. A. Franke in 2003 to pursue acquisitions and strategic investments in the air transportation and related industries. The firm was a significant investor in Tiger Airways based in Singapore and Spirit Airlines based in Ft. Lauderdale, Florida, and maintains lead investments in Wizz Air Holdings, Plc, a ULCC with multiple bases in Central and Eastern Europe and Volaris Airlines, a ULCC based in Mexico City. Indigo Partners is headquartered in Phoenix, Arizona.

Republic Airways Holdings, based in Indianapolis, Indiana, is an airline holding company that owns Chautauqua Airlines, Republic Airlines and Shuttle America. The airlines operate a combined fleet of more than 250 aircraft and offer scheduled passenger service on over 1,300 flights daily to more than 110 cities in the U.S., Canada and the Bahamas through fixed-fee flights operated under airline partner brands, including American Eagle, Delta Connection, United Express, and US Airways Express. The airlines currently employ approximately 6,000 aviation professionals.

Copyright Photo: Mark Durbin/AirlinersGallery.com. Indigo Partners is likely to keep the popular animals on the tails which plays well on their TV advertisements in the main Frontier markets, giving names to the talking tails. However the new very bold FLYFRONTIER.COM titles as displayed on Airbus A320-214 N220FR (msn 5661) with Sharklets may not survive. It will be interesting to watch for any changes to the current Frontier strategy by these low-fare airline investment fund people.

Frontier Airlines (2nd): AG Slide Show

 

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Republic Airways Holdings to sell Frontier Airlines to an affiliate of Indigo Partners

Republic Airways Holdings Inc. (Indianapolis) today (October 1) announced that it has entered into a definitive agreement to sell Frontier Airlines (2nd) (Denver) to an affiliate of Indigo Partners LLC (Phoenix) in an all-cash transaction.

Indigo Partners and its principals, led by managing partner William A. Franke, have a history of investing in airline transportation and related industries and creating successful, differentiated companies. Under the terms of the stock purchase agreement, which has been approved by Republic’s Board of Directors, the buyer, an affiliate of Indigo Partners, will acquire all the outstanding shares of Frontier Airlines Holdings, Inc. in a transaction valued at approximately $145 million, of which $36 million (subject to certain adjustments under the purchase agreement) is to be paid in cash for the equity of Frontier Holdings and the balance is indebtedness that will be retained by Frontier. In addition, Indigo plans to invest additional funds directly in Frontier after the closing.

As part of the transaction, under a separate agreement, Republic will assign to Frontier all of Republic’s rights under agreements relating to the Republic’s Airbus A320neo order in exchange for reimbursement of pre-delivery deposits, which total $32 million.

“We endorse and will support continued efforts to build Frontier into a leading nationwide ultra-low cost carrier (ULCC),” said Franke. “As airline fares continue to move up, passengers need affordable travel alternatives. Our goal will be to meet that need in more markets as we invest in the airline to grow its footprint, while maintaining a commitment to quality service, customer choice and satisfaction and continued employment opportunities for the Frontier team.”

Completion of the transaction is conditioned on agreements being reached with the Association of Flight Attendants (AFA) and FAPA Invest LLC by no later than October 31, 2013, as well as agreement and documentation of other third-party commercial agreements. The transaction is also subject to receipt of required approvals by the Federal Communications Commission for the transfer of Frontier’s radio licenses, the receipt of certain third-party consents and releases and other customary closing conditions.

Assuming satisfaction of the conditions of the agreement, Republic expects the transaction to close in December 2013.

Barclays is serving as financial advisor and Hughes Hubbard & Reed LLP is serving as legal advisor to Republic in connection with the transaction. Latham & Watkins LLP is serving as Indigo Partners LLC’s legal advisor.

Copyright Photo: Brian McDonough/AirlinersGallery.com. Frontier’s Airbus A320-214 N208FR (msn 4562) with the Cougar on the tail prepares to land at Baltimore/Washington.

Frontier Airlines: AG Slide Show

Indigo Partners to divest its shares of Spirit Airlines

Spirit Airlines (Fort Lauderdale/Hollywood) has issued this statement about the shares owned by Indigo Partners:

Spirit Airlines, Inc. has announced the public offering of 12,070,920 shares of common stock by certain existing stockholders affiliated with Indigo Partners LLC. Upon completion of the offering, investment funds affiliated with Indigo will no longer own shares of common stock of Spirit Airlines. The company will not receive any proceeds from this offering. Barclays is acting as the sole underwriter for the offering.

The shares of common stock are being offered pursuant to the Company’s existing shelf registration statement filed with the Securities and Exchange Commission (SEC) on July 31, 2012.

In connection with the offering, the Company also announced that William A. Franke and John R. Wilson have informed the Company that upon completion of the offering, they expect to resign as directors at the next board meeting, presently scheduled for August 7, 2013. Upon Mr. Franke’s resignation, the Company’s board intends to elect Mr. H. McIntyre Gardner, a director since 2010, as Chairman of the Board.

Copyright Photo: Tony Storck/AirlinersGallery.com. Airbus A320-232 N617NK (msn 5387) prepares to touch down at Baltimore/Washington.

Spirit Airlines: AG Slide Show