According to informed sources, the Trump administration is considering a bailout for Spirit Airlines (SAVE.US) under the authority of the Defense Production Act. The information comes from U.S. officials familiar with the discussions. The sources indicated the government may invoke Title III of the Defense Production Act, a provision that authorizes federal investment in industrial capacity to secure the defense supply chain. A White House spokesperson stated the administration "continues to explore all viable options to ensure the airline can continue operating for its passengers and employees." He added that specific reports about financing mechanisms or structures should be viewed as speculative. The Defense Production Act is an emergency powers law that allows the U.S. government to prioritize federal contracts with private companies and boost output of critical materials. The law also permits loans to private companies for defense purposes, a measure that could potentially support the airline. On Thursday, the President said the government is considering acquiring the distressed airline at an "appropriate price." He told reporters at the White House, "When oil prices fall, we would sell it for a profit." The Florida-based low-cost carrier is facing a tight deadline. A lawyer for Spirit Airlines stated on Thursday that the company needs to secure new financing or obtain access to use its cash by the end of next week. A court hearing is scheduled for next week as attorneys for the company and its creditors work to reach an agreement on a bankruptcy exit plan. An external lawyer for Spirit Airlines said on Thursday that the Trump administration has presented a financing proposal to help the airline exit bankruptcy protection, which is currently under review by its main creditors. An attorney for the airline's creditors confirmed on Thursday they have reviewed the term sheet of the government's proposal. Sources familiar with the matter report the proposal includes $500 million in financing, with the government receiving warrants equivalent to a 90% equity stake in Spirit Airlines as a condition. This debtor-in-possession financing would aid Spirit Airlines in completing its second bankruptcy restructuring since 2025.
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