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Spirit plans to rebrand as premium airline to boost

revenue

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Ted Christie to remain CEO post-bankruptcy

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Pilot union demands clear path to profitability

(Recasts, writes through)

By Rajesh Kumar Singh

March 12 (Reuters) - U.S. carrier Spirit Airlines ( SAVEQ )

, long known for its no-frills service, said on

Wednesday it was pushing ahead with plans to rebrand itself as a

premium airline as it emerged from bankruptcy protection after

four months.

The Florida-based airline - also known for its bright

yellow livery - had filed for bankruptcy protection last

November, after years of losses, failed merger attempts and

heavy debt levels. It was the first major U.S. carrier to file

for Chapter 11 since 2011 and it reported a net loss of $1.2

billion last year.

As part of its turnaround strategy, the company has said it

would shift its focus away from price-conscious customers to

more affluent travelers, in a move it estimates would generate

13% more revenue per passenger.

To attract customers, the airline plans to redesign its

loyalty program and enter into alliances with other carriers.

"Today, we're moving forward with our strategy to redefine

low-fare travel with our new, high-value travel options," said

CEO Ted Christie, who the company said would remain at the helm.

The company said the financial restructuring has reduced its

debt by about $795 million by converting debt into equity. It

also received a $350 million equity investment from existing

investors to support its future initiatives.

The lower debt and greater financial flexibility have left

it better-positioned to return to profitability, Spirit said.

The company said its newly issued shares were expected to

trade in the over-the-counter marketplace and it aimed to relist

on a stock exchange when it was "reasonably practicable."

Spirit last month rejected a $2.16 billion bid from

Frontier Group ( ULCC ), which has made multiple attempts to

merge with it, saying the offer was less beneficial to

shareholders than its restructuring plan.

Spirit's new strategy contrasts with the previous business

model that relied on price-sensitive travelers, keeping planes

flying more hours in the day and putting more seats on every

aircraft.

That playbook produced double-digit operating margins for

nine straight years until 2020. But the global pandemic changed

the operating environment and travel patterns, and Spirit

struggled to adapt.

Consumer demand has shifted in favor of full-service

airlines, with middle- and upper-income households fueling the

demand for premium travel while inflation disproportionately

hurt lower-income spenders. Spirit hopes the revamp of its

offering will allow it to tap more high-spending travelers.

The airline is also under pressure from its workers. On

Wednesday, Spirit's pilot union asked the company's leadership

to communicate a "credible and transparent path" to restoring

profitability without hurting the interests of its pilots.

Spirit has had to furlough hundreds of pilots as part of its

efforts to cut costs and shore up its finances.