JetBlue shares soared nearly 12% on Tuesday after activist investor Carl Icahn bought nearly 10% of the company’s stock and reports emerged that the company’s stock was undervalued.
The billionaire corporate raider amassed shares in a series of acquisitions that began on Jan. 26, according to regulatory filings obtained by authorities. CNN — one week after a federal judge blocked JetBlue’s $3.8 billion plan to buy ultra-low-cost carrier Spirit Airlines.
JetBlue and Spirit are appealing the decision, which would have created the nation’s fifth-largest airline.
The Justice Department argued that the agreement would reduce the availability of cheap airline tickets.
The newspaper said Mr. Icahn paid an average of $3.56 per share for his 33.6 million shares in multiple transactions between the end of January and February. filing.
JetBlue stock was $6.77 in mid-morning trading, up 11.5% from Monday’s closing price of $6.07.
Despite the surge, JetBlue’s stock price has fallen nearly 20% over the past 12 months.
Icahn’s filing with the Securities and Exchange Commission said he plans to continue discussions with the company “regarding potential board representation.”
“We remain open to constructive dialogue with investors as we continue to execute on our plans to increase value for all of our shareholders and stakeholders,” JetBlue said in a statement to the Post.
According to CNN, the 87-year-old founder of Icahn Enterprises is also considering buying additional shares.
Representatives for Mr. Icahn did not respond to requests for comment.
JetBlue’s pursuit of Spirit was motivated by the New York-based airline’s need to add rival aircraft and pilots to expand.
JetBlue and Spirit both lost money in 2023 as major airlines reported increased profits, but JetBlue claims recent cost-cutting plans will put them “close to breaking even” in 2024. There is.
The company also recently announced changes to its executive ranks. As of Monday, former president and chief operating officer Joanna Geraghty replaced Robin Hayes as CEO.
JetBlue is not Icahn’s first foray into the airline industry. Corporate raiders took TWA private in the late 1980s, but that did not save the defunct airline from filing for bankruptcy in 1992.
Mr. Icahn was eventually forced out of the airline in a last-ditch effort to regain control of TWA, which was acquired by American Airlines in 2001.
