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Icelandair has canceled its November 5 agreement to acquire rival WOW Air.
This comes two days after WOW Air announced its entry into a restructuring process, which included the removal of four aircraft from its fleet.
Icelandair Group said in a press release:[We have] issued a stock market announcement on Monday, November 26, in which it stated that the company considered it unlikely that all the conditions of the share purchase agreement would be fulfilled by the general meeting of shareholders of November 30 . This situation remains unchanged."
Both parties agreed to abandon the takeover projects.
The planned acquisition of the Icelandair group from WOW air will not be accepted. The board of directors and management of both companies have worked hard on this project. This conclusion is certainly disappointing.Bogi Nils Bogason, President and CEO of Icelandair Group
WOW Air, a low-cost Icelandic carrier struggling financially, has taken a step toward liquidity. Earlier this week, he confirmed that he was suffering from a decline in sales and published weakened financial forecasts.
"Airport Associates", the ground handling provider of WOW Air, announced Thursday the dismissal of 237 employees, "[…] because of uncertainty about the future of the aviation market at Keflavik Airport."
Following the failure of Icelandair's investment in WOW Air, the low-cost carrier announced a new deal on Thursday night, this time with Indigo Partners LCC.
I am excited to work with Indigo and I am convinced that it is the best long-term solution for our pbadengers and our pbadengers.Skuli Mogensen, CEO of WOW Air
Indigo is a major investor in the airline industry. It has several large low-cost carriers, including Frontier Airlines and WizzAir. The details of the agreement with WOW Air have not been announced yet.
Read more: WOW Air enters a restructuring process and withdraws several planes
This is a story in development. More soon.
German aviation journalist. Editor-in-Chief of International Flight Network.
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