Under the terms of the agreement, Indigo will pay $36m in cash and assume frontier’s debts.
The firm also said that it plans to provide additional funds to frontier following the completion of the deal, which is expected in December this year.
The deal came just over a month after Indigo exited its 16.6 per cent stake in budget carrier Spirit Airlines via a public offering. Indigo’s stake was worth $427m based on the comany’s share price of $35.39 at that time.
Indigo managing partner William A. Franke said, “We endorse and will support continued efforts to build Frontier into a leading nationwide ultra-low cost carrier.
“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.”
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