Southwest Submits Proposal to Purchase Frontier Airlines

Southwest Airlines has confirmed that the carrier is preparing a bid to acquire Denver-based Frontier Airlines, which will be sold at auction in bankruptcy court next month.

The carrier has submitted a nonbinding proposal in accordance with the bidding procedures established in the U.S. Bankruptcy Court for the Southern District of New York.

The bid is worth a minimum of $113.6 million, which is in excess of the bid currently filed by Republic Airways. Submission of a nonbinding proposal gives Southwest an opportunity to engage with Frontier in the due diligence required to determine the scope of a binding proposal to be submitted by the court’s Aug. 10, 2009, deadline.

The acquisition would make Southwest more competitive in Denver and elsewhere. Frontier filed for bankruptcy court protection in April 2008. On June 22, 2009, Republic Airways submitted a bid to purchase Frontier for $108.8 million.