Is Spirit Airlines Close to a Buyout Deal with Investment Firm Castlelake?

Spirit Airlines is reportedly in acquisition talks with an investment firm. The South Florida-based carrier is currently operating under Chapter 11 bankruptcy protection. CNBC reported that Minneapolis-based Castlelake is the potential suitor. Spirit Airlines, however, refused to discuss the report.

A spokesperson stated they do not comment on market rumors. No mention of a takeover is in the airline’s recent bankruptcy files. This news comes as the ultra-low-cost carrier actively seeks a buyout partner.

The Suitor: Castlelake's Aviation Focus

Castlelake is a major global alternative investment firm. The firm manages approximately $33 billion in assets. It specializes in asset-based private credit solutions.

Castlelake has a long history in aviation finance. Last August, the firm launched Merit AirFinance. This new entity is an aviation lending arm. It launched with $1.8 billion in deployable capital. A takeover would likely focus on Spirit’s physical assets. This includes aircraft, gates, and other equipment. This approach addresses the airline’s broader financial restructuring.

Path to Reorganization or Sale

Spirit Airlines filed for Chapter 11 last August 2025. This was the second filing in under a year. The airline faced heavy competition and creditor pressure.

Since the filing, Spirit has made significant changes. They reduced their fleet and revamped their route network. They also renegotiated aircraft leases. The carrier secured $100 million in labor concessions. This was from unionized pilots and flight attendants.

In December, Spirit Aviation Holdings reached an agreement. This was with its senior secured noteholders. The deal released $100 million in credit funding. Half of this amount, $50 million, was used immediately. The remaining $50 million is conditional. It requires progress on a standalone reorganization plan. It also requires progress on a strategic transaction possibilities. The airline confirmed it is in active negotiations for both.

History of Failed Deals

Spirit has sought a buyout partner for four years. Rival Frontier Airlines was a perennial suitor. However, Frontier repeatedly failed to secure a deal. A $3.8 billion bid by JetBlue Airways was blocked. A federal judge derailed that deal on antitrust grounds.

Liquidation Concerns

Earlier this month, the Air Line Pilots Association (ALPA) acted. They published an open letter to leading creditors. The union urged support for the reorganization plan. They strongly opposed the airline's liquidation. There is no public evidence of the latter option.

Operational Context and Industry Impact

Despite financial difficulties, Spirit Airlines remains a key player. The Dania Beach-based carrier holds the top spot. It leads in market share at Fort Lauderdale-Hollywood International Airport (FLL). Spirit holds 28.5% of the passenger market share. This data is compiled through November.

Spirit’s dominant position at FLL is a valuable asset. It is a key factor in any potential takeover. The airline is also working to improve operations. It was recently ranked highly for on-time performance. This was according to aviation analytics firm Cirium.

The reported talks with Castlelake signal a critical juncture. The outcome will define the future of the ultra-low-cost carrier model. It will also impact competition in the US market. Stakeholders await official confirmation from Spirit Aviation Holdings.

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