Spirit Airlines is reportedly planning to file for Chapter 11 bankruptcy protection after its latest attempt to merge with Frontier Airlines fell through. 

This marks the second failed merger in less than two years, leaving Spirit facing significant financial challenges. The ultra-low-cost carrier has been struggling to recover from mounting losses and debt maturities. 

The company is expected to file within weeks, people familiar with the matter told The Wall Street Journal. 

Shares of the company cratered more than 55% on Wednesday. 

SPIRIT AIRLINES PLANS TO SELL PLANES, CUT JOBS

The company announced on Tuesday that it has been in ongoing talks with bondholders about restructuring its debt and exploring ways to improve its financial situation.

If the company reaches a final agreement, Spirit said it will likely go through a legal restructuring that is not expected to affect general creditors, employees or customers, but it could result in the cancellation of the company’s current stock. If no agreement is reached, the company will explore other options.

The company reportedly reignited potential merger talks with Frontier Airlines this year after its plans to merge with JetBlue in a deal worth $3.8 billion was blocked by regulators in January over concerns that the deal would hurt the availability of low-cost air travel tickets.

JETBLUE, SPIRIT AGREE TO TERMINATE MERGER OVER REGULATORY ISSUES

However, people familiar with the matter said Frontier opted not to move forward with the merger. 

In 2022, Frontier and JetBlue had been in a months-long bidding war for Spirit after Frontier's parent company, Frontier Group Holdings, and Spirit announced a definitive merger agreement.  

Last month, Spirit announced plans to sell multiple aircraft and lay off workers as it tried to raise cash and revive operations.

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In a filing with the Securities and Exchange Commission (SEC), Spirit said it identified approximately $80 million in annualized cost reductions that it plans to implement next year. 

These cost reductions will primarily result from "a reduction in workforce commensurate with the company’s expected flight volume," Spirit said in the filing. The company didn't disclose how many cuts would be involved.