There's probably more truth in your words than you realize. With the legacies now down to just three big ones, the LCC-level will need to consolidate to compete better and ensure long-term success. If I had to guess, I would think Indigo owners/Franke will turn Frontier into a full ULCC, IPO it, and then a merger with Spirit. VX will IPO, and at some point down the road, probably merge with JetBlue. Not sure what name would be kept, maybe something like virgin Blue. The consolidation at the legacy level is done and the DOJ is obviously not going to approve any big legacy mergers.
Just fwiw, a company does not need to be public to merge. If Spirit were interested in Frontier, or JetBlue in Virgin, IPO or not makes no difference if the money is right.
S