JetBlue Airways Corp said on Thursday it would sell Spirit Airlines Inc's holdings at New York's LaGuardia Airport upon completion of their planned merger.

Spirit's holdings, which JetBlue intends to sell to Frontier Group Holdings Inc, includes six gates at the Marine Air Terminal and 22 takeoff and landing slots.

JetBlue said the agreement with Frontier would help maintain the same level of low-cost carrier service at LaGuardia Airport.

These divestitures are part of JetBlue's commitments included in the merger agreement with Spirit. The deal is expected to close in the first half of 2024.

The U.S. Transportation Department in March had denied an exemption request by JetBlue and Spirit to operate under common ownership, citing the Justice Department's antitrust lawsuit in the same month seeking to block the deal.

The Justice Department had challenged the deal saying it would eliminate competition, lead to higher ticket prices, reduce passenger capacity and shrink consumer choices.

(Reporting by Pratyush Thakur in Bengaluru; Editing by Shilpi Majumdar)