Frontier Group Holdings Inc. ULCC +3.87% agreed to buy Spirit Airlines Inc. SAVE +17.51% for $2.9 billion in cash and stock in a deal that would create a discount-airline juggernaut.
Ultralow-cost airlines, designed around cutting costs and fares by offering a more basic flying experience, have upended the airline industry in recent years. The deal unveiled Monday would bring together two of the biggest such airlines, which the carriers said would create the fifth-largest U.S. airline and allow them to compete more aggressively against larger rivals.
“This transaction is centered around creating an aggressive ultralow fare competitor to serve…
