Wow Air: Icelandic airline returns four planes as currency crisis worsens

Another Iceland-owned airline is facing a cash crisis after what it calls "worse" results.

In October, Primera Air went bankrupt, blocking tens of thousands of pbadengers and leaving many more pbadengers out of pocket.

Now, Wow Air, which links Gatwick, Stansted and Edinburgh to Reykjavik with downstream links to North America, has admitted that its results are "much worse than expected".

Skuli Mogensen, the airline's managing director, wrote to bondholders that "many internal and external events have unfortunately worsened significantly" since a bond was issued in September.

He accused the collapse of Primera Air of becoming "negative" about Wow Air's financial situation, which he said "has aggravated an already difficult situation."

A sale and leaseback agreement of $ 25 million (£ 11.7 million) was canceled.

Mr. Mogensen wrote: "Due to the persistence of negative events, all of our donors, creditors and authorities are keeping a close eye on the situation and demanding stricter payment terms before continuing to put pressure on our flows. cash.

"As a result, our fourth quarter results are noticeably worse than expected."

Icelandair, Wow's biggest rival, took over. The transaction, worth 18 million euros, was to be approved at a general shareholders' meeting on 30 November. Bogi Nils Bogason, managing director of Icelandair Group, said: "The stock purchase agreement contains many conditions that will have to be fulfilled before the meeting.

"Currently, Icelandair Group believes that it is unlikely that all conditions will be fulfilled at that time.

"The company will continue to work on the transaction and the parties are continuing the dialogue on the next steps."

The problems are thought to arise from conditions related to Icelandair bonds worth approximately £ 160 million. Four Wow Air aircraft were returned to the lessors. Two Airbus A330s, an A321 and an A320, departed Keflavik Airport to fly to airports in Ireland, Italy and France.

The two big-lift A330s landed in the early hours of Wednesday morning at the Lourdes airport, a "cemetery" for retired planes.

This decision reduces the size of the Wow Air fleet by one-fifth and the number of available seats by about a quarter, because it only has one full-body Airbus remaining.

L & # 39; Independent asked for an answer from Wow Air.

Until now, the carrier has intensely competed with Icelandair, especially when traveling between the United Kingdom and the United States. In 2017, Wow Air published "London-New York flights" for £ 99, but none was actually available at this price.