Frontier Group Closes in on IPO

By Chris Lange Updated Jan 12, 11:05AM EST · Published Jun 13, 11:30AM EDT

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Frontier Group Closes in on IPO — © Thinkstock

Frontier Group Holdings has registered an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering (IPO). No pricing details were mentioned in the filing. The company intends to list its shares on the Nasdaq under the symbol FRNT.

The underwriters for the offering are Citigroup, Deutsche Bank, Evercore ISI, JPMorgan, Merrill Lynch, Barclays, Cowen, Credit Suisse, Goldman Sachs, Raymond James and UBS Investment Bank.

Frontier Airlines is an ultra-low-cost carrier (ULCC) with a business strategy focused on “Low Fares Done Right.” The company offers flights throughout the United States and to select international destinations in Mexico and the Caribbean. Its unique and sustainable strategy is underpinned by its low-cost structure and superior ULCC brand.

At the end of March 2017, the firm operated a fleet of 68 narrow-body Airbus A320 family aircraft, which it expects to grow to 121, including 80 A320neo (New Engine Option) family aircraft, by the end of 2021. In the 12 months ended March 2017, Frontier served approximately 15.4 million passengers across a network of 61 airports.

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In the filing, Frontier detailed its metrics:

As a result of these and other initiatives, we have reduced our cost per available seat mile (CASM) (excluding fuel) from 7.89¢ for the year ended December 31, 2013 to 5.74¢ in the year ended December 31, 2016, and our Adjusted CASM (excluding fuel) from 7.89¢ for the year ended December 31, 2013 to 5.43¢ in the year ended December 31, 2016, an improvement of 27% and 31%, respectively. In 2016, this was one of the U.S. industry’s lowest unit operating costs. For the three months ended March 31, 2017 and 2016, our Adjusted CASM (excluding fuel) was 5.50¢ and 5.90¢, respectively.

The company intends to use the net proceeds from this offering to fund into a trust the expected cash portion of its obligations under the Pilot Phantom Equity Agreement for the benefit of the participating pilots in connection with the completion of this offering. The remainder will be put toward working capital and general corporate purposes.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.