Delta could add more gates at Hartsfield-Jackson Atlanta International Airport through Spirit bankruptcy deal

Delta Air Lines could gain control of two additional gates and related airport space at Hartsfield-Jackson Atlanta International Airport under a proposed agreement filed in Spirit Airlines' ongoing bankruptcy proceedings.

Court filings submitted in the U.S. Bankruptcy Court for the Southern District of New York show Spirit Airlines is seeking approval to assign its lease for gates C4 and C6, along with ticketing lobby and support space at Hartsfield-Jackson, to Delta for $12 million.

The filing is part of Spirit's Chapter 11 bankruptcy case and comes as the airline continues winding down operations and selling assets.

According to a declaration filed by Spirit Vice President of Corporate Real Estate and Airport Administration Chip Sandifer, the airline entered into the Atlanta airport lease in 2017. The agreement covers preferential-use Gates C4 and C6, as well as ticketing and support facilities. The lease was extended through June 30, 2031, following approval by the Atlanta City Council.

Spirit told the court that Delta would pay a one-time $12 million assignment fee if the transaction is approved and completed.

The airline said it marketed the leasehold interest through a competitive process, contacting 10 potential parties. Spirit said Delta and one other bidder ultimately submitted competing offers. After multiple rounds of bidding, Delta increased its offer to $12 million, which Spirit said exceeded the competing proposal.

Spirit told the court it determined Delta's bid represented the highest or best offer available and would provide the greatest recovery for the bankruptcy estate. The company also said the transaction would allow it to stop paying ongoing costs associated with the leased airport space during its wind-down.

As part of the proposed deal, Spirit would pay approximately $721,934 to satisfy lease-related cure obligations required under bankruptcy law.

The filing states that once the assignment becomes effective, Delta would assume Spirit's rights and obligations under the lease through June 2031.

A hearing on the motion is scheduled for July 8 before U.S. Bankruptcy Judge Sean H. Lane in New York. Objections to the proposal are due by July 1.