JetBlue shares spike after Carl Icahn takes 10% stake

Shares of JetBlue Airways jumped Tuesday after activist investor Carl Icahn bought a nearly 10% stake in the carrier.  

The billionaire behind Icahn Enterprises owns 33.62 million shares, which is equivalent to a 9.91% stake, according to a filing with the Securities and Exchange Commission which also noted Icahn believes the shares are “undervalued and represented an attractive investment opportunity.”

JetBlue’s stock is on pace to reach its highest close since August 2023 when it closed at $6.90, according to Dow Jones Market Data Group. However, shares are down nearly 30% over the past 12 months. 

JUDGE BLOCKS $3.8B JETBLUE-SPIRIT MERGER, CITES ‘ANTICOMPETITIVE HARM’

JetBlue, in a statement to FOX Business, said:

“We are always open to constructive dialogue with our investors as we continue to execute our plan to enhance value for all of our shareholders and stakeholders.”

Inquiries to Icahn by FOX Business were not immediately returned. 

The headwinds for the shares are tied to the carrier’s failed attempt to merge with discount rival Spirit. 

SPIRIT AIRLINES EXPLORES RESTRUCTURING OPTIONS FOLLOWING JETBLUE DEAL COLLAPSE

Last month, a federal judge blocked JetBlue Airways’ proposed $3.8 billion acquisition of the budget carrier after agreeing with the Justice Department that the deal would hurt the availability of low-cost air travel tickets. 

U.S. District Judge William Young wrote that the proposed merger between JetBlue and Spirit “does violence to the core principle of antitrust law: to protect the United States’ markets – and its market participants – from anticompetitive harm.”

Days later, JetBlue and Spirit filed a notice of appeal with the First U.S. Circuit Court of Appeals to try and reverse the decision. 

JetBlue’s lawyers argued the case was a “misguided” challenge to a merger between the sixth- and seventh-largest airlines in the U.S. that control less than 8% of the domestic market combined. 

Spirit Airlines is looking at ways to address its financial challenges after the deal was blocked, sources familiar with the matter told the Wall Street Journal. 

FOX Business’ Eric Revell contributed to this report.