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Spirit Airlines (SAVE) stock was soaring Monday morning after the budget airline revealed it had struck a last-minute deal to refinance some debt.
The company said it had managed to push back its deadline to refinance roughly $1.1 billion in debt from Monday to Dec. 23, according to a regulatory filing posted Friday. Shares climbed by more than 42% in pre-market trading on the news.
Spirit also said that it had borrowed the entirety of a $300 million revolving credit facility it had set up in March 2020. Borrowings under that facility are scheduled to mature at the end of September 2026. Spirit on Monday also reiterated it expects to end 2024 with more than $1 billion in liquidity.
Earlier this month, Spirit stock tanked following reports that it may soon file for bankruptcy. Speculation has swirled for months that Spirit might be approaching bankruptcy. After a judge blocked its $3.8 billion merger with JetBlue Airways (JBLU+3.44%) in January on antitrust grounds, the two companies called off their tie-up attempt two months later rather than pursue the deal through an appeal.
While JetBlue has called the situation “three years of distraction” and moved on, Spirit has had more trouble going it alone. Although it has tried things such as eliminating certain fees and teasing comfier seating arrangements than its usual budget offerings, the company’s stock has taken a hit over the past year.
The carrier’s latest financial report showed its 11th consecutive quarterly loss and revealed its struggle to make headway in a turnaround while having to increasingly compete with larger so-called “legacy” players for low-fare customers. In recent months, Spirit has deferred airplane deliveries, furloughed hundreds of pilots, and offered “voluntary unpaid leaves of absence” to flight attendants. as part of an initiative to save $100 million this year.
— Melvin Backman contributed to this article.