Frankly, this proposal makes much more sense to me than the DIP deal that was announced recently with Perseus. I was not a big fan of the deal — or at least what I had read about it. As I said then, I had anticipated there would be another airline involved in any deal for Frontier. For two reasons. One, it makes more sense than some kind of stand-alone venture, and two, if it was a good airline, with a reasonably strong management team, the sharing of management bench strength would be a plus.

This one hits on both counts, as best as I can tell at this early stage of the game.

Today, Frontier Airlines announced that it was going to go with an alternative DIP financing proposal that is anchored by members of the airline’s Unsecured Creditors Committee. The three key players in this deal are Republic Airlines Holdings, Credit Suisse, and AQR Capital.

The three are offering the airline up to $75 million in DIP financing, with an immediate firm commitment and funding of $30 million.

This new DIP facility provides Frontier with lower financing costs, less restrictive covenants and greater flexibility to pursue strategic opportunities without being constrained by more restrictive DIP provisions, according to a release the airline put out.

Sounds much better to me.