Frontier Group Holdings ( ULCC ) has proposed a merger with Spirit Airlines ( SAVEQ ) through newly issued debt and stock, offering higher recoveries for Spirit’s stakeholders than its standalone restructuring plan.

By combining, Spirit investors would benefit from a stronger low-cost carrier and significant synergies. Frontier remains open to further discussions with Spirit and its financial stakeholders.

“While we are pleased with the strong results Frontier has been able to deliver through the execution of our business strategy, we have long believed a combination with Spirit would allow us to unlock additional value creation opportunities. As a combined airline, we would be positioned to offer more options and deeper savings, as well as an enhanced travel experience with more reliable service,” said Barry Biffle, CEO of Frontier.

Related: What’s Going On With Spirit Airlines Stock Wednesday?

Since submitting its proposal, Frontier has engaged with Spirit’s board, management, and financial stakeholders, sharing materials highlighting the deal’s benefits. Based on Spirit’s bankruptcy filings, these materials suggest its standalone plan would leave it unprofitable with heavy debt and limited chances of success.

Frontier also submitted a letter to Spirit’s Chair and CEO detailing the merger proposal and willingness to negotiate. The letter stressed the strategic advantages of merging, asserting it would create more value for Spirit’s stakeholders than its current bankruptcy plan.

While reaffirming its commitment to negotiations, Frontier noted that Spirit had yet to provide a counterproposal. The company warned that Spirit’s standalone plan would leave it highly leveraged and unprofitable, emphasizing the urgency of an agreement.

Price Action: ULCC shares are trading higher by 2.70% at $7.99 premarket at the last check Wednesday.