After a weekend of circulating rumors about an imminent shutdown, Spirit Airlines shut them down with the announcement that it secured $100 million short-term debtor-in-possession financing that it can put toward sustaining operations.

Half is available immediately, while the other half is contingent on making progress toward a meaningful restructuring after the airline filed two bankruptcies within nine months of each other.

“$50 million (minus OID) is useable by Spirit immediately and the use of the remaining amount is subject to previously agreed conditions that relate to further progress on a standalone plan of reorganization or a strategic transaction,” the airline said in a Dec. 15 statement. “Spirit is currently in active negotiations on each of these possibilities.”

Spirit reportedly talking to Frontier about third attempt at a merger

With initial speculation of a shutdown by aviation website The Air Current now proven to be unfounded, Bloomberg is now reporting that the next announcement from the airline will involve plans to merge with fellow low-cost rival Frontier Airlines.

This would mark the third time in as many years that the two low-cost airlines have attempted to merge. Early discussions with Frontier throughout 2022 fell apart when Spirit accepted a higher offer of a $3.6 billion by New York-based JetBlue Airways, but the acquisition was ultimately called off by a federal judge over antitrust concerns in March 2024.

Related: Those rumors of Spirit shutting down and canceling all flights ended up being totally false

At the start of 2025 and after a significant drop in Spirit’s valuation after it filed for bankruptcy for the first time in November 2024, Frontier made an offer that involved $400 million in take-back debt and 19% of Frontier shares to Spirit creditors for a total valuation of $2.1 billion.

But the offer did not address the $350 million in debtor-in-possession financing Spirit would need to bridge.

At the time, then-Spirit CEO Ted Christie classified the Frontier offer as “inadequate and unactionable,” and talks of a merger ultimately fizzled out.

With its famous bright-yellow livery and customer base that still associates it with ultra-low fares, Spirit retains a strong brand, despite accumulating losses that make its independent future increasingly uncertain.

Spirit Airlines filed for bankruptcy for the second time in less than a year in August 2025.

Image source: Shutterstock

The latest on Spirit Airlines bankruptcies, merger talks, and what that means for travelers

“The potential transaction could be announced as early as December, said the sources, who requested anonymity,” Bloomberg reports on conversations with insiders who have knowledge of the discussions.

“They cautioned that the talks are still ongoing and might conclude without an agreement.”

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Other than reporting that talks about a merger have been renewed, Bloomberg has released very few other details about what each side is pushing for or the transaction would look like.

In a separate abrupt change for the involved airlines, longtime Frontier CEO Barry Biffle was replaced by President James Dempsey on Dec. 15, according to Skift.

Biffle had helmed the Denver-based airline since 2016, and the sudden change in leadership sent Frontier stock down by more than 15% on the day the news broke. The airline provided no commentary on the reasons behind it, beyond vague comments about seeking a new direction.

Related: Large transportation company files for Chapter 11 bankruptcy