Spirit Airlines, Inc. ( SAVE ) shares are moving higher Wednesday following the resurgence of merger talks with Frontier Group Holdings Inc ( ULCC ). .

What To Know: Frontier is once again exploring a takeover deal with Spirit Airlines ( SAVE ) as Spirit engages with bondholders over a potential bankruptcy filing, according to the Wall Street Journal.

People familiar with the matter said the merger would likely coincide with Spirit’s restructuring of its debt along with other liabilities in bankruptcy. The talks with Frontier are reportedly still in the early stages and there is no guarantee that the two airlines will strike a deal.

While Spirit has been in the midst of negotiating with bondholders over possible bankruptcy terms, the company has also been exploring options outside of bankruptcy, including a restructuring of its balance sheet.

Spirit successfully reached an agreement with its credit-card processor last week, giving the company until the end of December to refinance $1.1 billion of bonds. If the company fails to do so, it could lose the ability to process credit card transactions in 2025.

Spirit and Frontier have floated around the idea of a potential merger on and off for years. In 2022, the companies nearly reached an agreement, but JetBlue Airways Corporation ( JBLU ) made a competing offer that won over shareholders before the merger was blocked by a federal district court earlier this year.

A successful merger between Frontier and Spirit would mean one less travel option for budget conscious consumers, giving airlines greater pricing power. The combined company could also win more budget conscious customers away from other major airlines trying to compete in that market.

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SAVE Price Action: At the time of writing, Spirit shares were up 38.9% at $2.92, according to data from Benzinga Pro.

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