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Spirit Offered Taxpayers 80% Of The Airline — Trump Demanded 90% And The Bailout Died
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Spirit Offered Taxpayers 80% Of The Airline — Trump Demanded 90% And The Bailout Died

View from the Wing·Gary Leff·25 days ago
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Here’s an interesting tidbit from the Wall Street Journal on how President Trump’s ‘Art of the Deal’ negotiating may have killed the taxpayer bailout. The federal government was prepared to put up $500 million, despite having no plausible legal basis for accessing the funds. Spirit Airlines offered the government an 80% stake in the company in exchange for the funds. The President came back asking for 90%. Ultimately, 90% was too high and creditors couldn’t agree, because there would be too little left for them. The airline would blow through the cash, they’d retain only 10% of the airline, and they’d recover more of their investment by selling off gates and slots at New York LaGuardia and other assets. A taxpayer bailout and government ownership would have been a terrible idea. The airline didn’t shut down because of high fuel costs. The industry started expecting them to liquidate back in December , long before the run up in jet fuel.…

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