WOW air Fulfills Conditions for Purchase
WOW air has now fulfilled all conditions required for its purchase by Indigo Partners. Fréttablaðið reports that the two parties are now working to finalise the acquisition. The deadline for closing the deal, given to WOW air by its shareholders, is tomorrow: February 28.
In preparation for the deal, WOW air has downsized its operations significantly, cutting their fleet down from 20 jets to 11 and dropping several destinations from their itinerary. The airline expects to transport 2.1 million passengers this year, a marked drop from the 3.5 million it transported last year.
Among the biggest obstacles to concluding the purchase was a 12-year rental agreement WOW air had made with Irish aircraft rental company Avolon for four new Airbus A330 jets. Made in 2017, the agreement was meant to provide the airline with two jets at the end of last year and two more at the end of 2019. WOW was required to pay a hefty pentalty for backing out of the contract.
Indigo Partners will initially acquire 49% of WOW air, though according to the terms of the agreement, the investor could acquire a larger stake in future.