Frontiers Airlines Plans IPO: What Investors Need To Know

For the second time in four years, the low-cost carrier Frontier Airlines has filed for an initial public offering (IPO).

What Happened: The Denver-headquartered airliner was publicly-traded prior its to filing for bankruptcy in 2009. Republic Airways Holdings acquired Frontier for $108.8 million out of bankruptcy, and in 2013 it was sold to the private equity firm Indigo Partners for $145 million.

Frontier previously filed an S-1 seeking to raise $700 million in March 2017, but that filing remained dormant before it was withdrawn last summer.

The coronavirus pandemic made a significant dent in the airline industry and Frontier was not immune from its tumult. According to its regulatory filing, the company posted a $225 million loss in 2020 on revenue of $1.25 billion, compared with net income of $251 million on sales of $2.5 billion during 2019.

Why It’s Happening: According to the U.S. Department of Transportation, airlines carried 60% fewer passengers in 2020. With the rollout of the vaccines to mitigate the pandemic, there is increased optimism that industries impacted by the disruptions created during the health crisis can begin to return to normal.

For its part, Frontier appears to be readying itself for increased passenger volume in 2021. Since the beginning of the year, Frontier has expanded its flight schedules, with increased new routes serving Las Vegas, Miami and Orlando, as well as new service at Delaware’s New Castle Airport and California’s Oakland International Airport. It also partnered with ATP Flight School on a program to recruit the school’s graduates into careers at the airline.

Frontier plans to list on Nasdaq under the ticker FRNT, although its filing did not state the number of shares or price range at which it expects to sell. Frontier is the second airline to seek an IPO this year, following an announcement last month by Sun Country Airlines.

(Photo contributed by Frontier Airlines)