After several attempts and re-negotiations, the Icelandair Group has finally arrived at the decision not to get involved in WOW air operations and not to invest into the struggling airline.
WOW air, the Icelandic low-cost carrier, has been going through the hard times since autumn 2018. Reducing some destinations, fleet, number of employees, WOW air was looking for the ways to keep the airline operable. Icelandair was one of the most potential buyers.
However, “Icelandair Group has decided that its possible involvement in WOW air’s operations, as announced on 20 March 2019, will not materialize. Therefore, all discussions between the parties have been cancelled”, said statement on the WOW air website.
This is not the first time WOW air was in negotiations with Icelandair. In November 2018 Icelandair Group had announced about possible acquisition of WOW air. Therefore, shortly after Icelandic low-cost carrier entered restructurization process, the flag carrier of Iceland dropped the idea of investing into WOW air.
Meanwhile, WOW air entered into negotiations with Indigo. Nevertheless, this partner also stepped out of the rescue 21 March, 2019.
“The proposed investment of Indigo Partners LLC (“Indigo Partners”) in WOW air has been cancelled by Indigo Partners. Therefore, all negotiations between WOW air and Indigo Partners have been cancelled”, WOW air reported.
Currently, “a majority of WOW air Bond Holders and other creditors of WOW air are in advance discussions with the aim of reaching an agreement on a voluntary restructuring including an agreement of converting current debt into equity and fund the company towards long term sustainability”.
On 26 March, 2019, the airline updated that “bondholders have formally approved to convert their bonds into equity and formal discussions with investors have commenced to fund the company. This is an important milestone in financially restructuring the company and secure the long-term sustainability of WOW air”.