In the clearest sign yet that bankruptcy is on the itinerary, Spirit Airlines warned early Wednesday that it is preparing for a "statutory restructuring" if it successfully renegotiates terms with its bondholders.

Spirit Airlines is reportedly planning to file for bankruptcy following the collapse of a proposed merger with Frontier Airlines that sent its stock into rapid decline.

Spirit Airlines is now reportedly in advanced talks over a possible bankruptcy filing following a failed merger and continued financial struggles, The Wall Street Journal reported Tuesday evening. The company had been exploring a merger with another low-cost airline,