Spirit Airlines Emerges From Bankruptcy Protection

Spirit Airlines exits Chapter 11 with reduced debt, new financing, and a plan to enhance guest experiences while working toward profitability.

A Spirit Airlines commercial airplane after takeoff from Harry Reid International Airport in Las Vegas on Feb. 8, 2024. Mike Blake/Reuters

Spirit Airlines has emerged from Chapter 11 bankruptcy, completing a financial restructuring that significantly reduces its debt and strengthens its financial position, the company said in a statement on March 12.

The airline, known for its ultra-low-cost model, announced that it has equitized approximately $795 million in funded debt and secured a $350 million equity investment from existing investors. The move is expected to support its long-term stability and fund enhancements to its travel offerings.

The restructuring plan, which received overwhelming approval from Spirit’s loyalty and convertible noteholders, was confirmed by the United States Bankruptcy Court for the Southern District of New York. With the process complete, Spirit moves forward with a streamlined balance sheet and increased financial flexibility.

Ted Christie, Spirit’s president and CEO, expressed optimism about the airline’s future.

“We’re pleased to complete our streamlined restructuring and emerge in a stronger financial position to continue our transformation and investments in the guest experience,” he said in a statement. “Throughout this process, we’ve continued to make meaningful progress enhancing our product offerings while also focusing on returning to profitability and positioning our airline for long-term success.”

Spirit’s new board of directors includes industry veterans, in addition to Christie, in their bid to restructure the company successfully.

As part of the restructuring, Spirit’s previous common stock was canceled. Newly issued shares are now held by Spirit’s new owners and are expected to trade “over the counter,” with plans to relist on a stock exchange in the near future.

Spirit Airlines filed for Chapter 11 protection in November 2024 amid mounting financial difficulties.

At the time, the airline faced intense competition from major carriers offering lower fares, as well as operational challenges, including grounded aircraft due to engine issues and rising labor costs.

Prior to its bankruptcy filing, Spirit had also struggled with failed merger attempts, most notably with JetBlue Airways, a deal that a federal judge ultimately blocked due to antitrust concerns. The company also rejected a takeover bid from its rival Frontier Airlines last month.

Amid the challenges, Spirit continued operating flights throughout the bankruptcy process. The airline reassured customers that tickets, credits, and loyalty points would remain valid, and it pledged to maintain its commitment to low-cost travel.

Emerging with what the company considers a stronger financial foundation, Spirit plans to focus on enhancing customer experience while maintaining its low-fare approach.

The airline serves destinations across the United States, Latin America, and the Caribbean with a fleet known for being one of the youngest and most fuel-efficient in the industry, the company said.

Mary Man and Jacob Burg contributed to this report.