The pandemic is far from over, but some airlines believe the travel business is already on an upswing. Frontier Airlines, a budget carrier based in Denver and known for putting images of wild animals on its planes, is expected on Thursday to become the second airline thisto list its shares on a stock exchange. Frontier plans to raise $266 million by selling 15 million shares at $19 each on Nasdaq under the symbol ULCC, a nod to its strategy as an “ultra-low-cost carrier.” Frontier’s existing stockholders will sell another 15 million shares.
The industry may be struggling through one of the worst crises in its history. Still, travel is recovering, and carriers like Frontier and Sun Country Airlines, which finished an initial public offering in mid-March, they are well-positioned for the rebound. Unlike the largest airlines, budget carriers don’t rely on corporate or international travel, which is not expected to bounce back soon. Frontier and Sun Country offers to passengers visiting family or friends or going on leisure trips, the kind who have been leading the recovery.
“The time is now,” Barry Biffle, the airline’s invest in sales and marketing, repay debt, and shore up its cash reserves. The offering is 6., said in an interview. “If you look, the , and you see it everywhere. You’re Many investors seem to agree. Sun Country’s more than 40 percent when it hit the market two weeks ago. . Frontier, the last of the nation’s ten largest airlines to go public, said it planned to use the money it raised to buy equipment,
The airline’smay be well suited for a recovery, but risks abound. The recovery could be derailed if the prove ineffective at providing long-term protection or if they fail to shield people from new coronavirus variants. A spike in jet fuel prices, which of Frontier’s costs, could hinder its ability to keep fares low. And competition will probably be fierce in the . Discount companies will be up against one another. The four — American Airlines, Delta Air Lines, United Airlines, and Southwest Airlines, have vast resources and are eager to make up lost revenue.
Still, the initial public offering marks an impressive turnaround for Frontier, which sought costs low and passing those savings onto customers, sometimes offering fares so cheap that they can attract customers who weren’t planning to travel.in 2008 during the financial crisis. The with high fuel costs and intense competition from United and Southwest at the Denver airport. Frontier emerged from restructuring a and was acquired in 2013 by an affiliate of Indigo Partners, a private equity firm specializing in ultra-low-cost airlines. Indigo has previously invested in and advised Spirit Airlines, Tigerair in Singapore, Volaris in Mexico, and Wizz Air in Europe. Like those companies, Frontier focuses intently on keeping