Icelandair Group is set to acquire fellow Reykjavík-based carrier WOW air after signing a share purchase agreement. The deal, announced on November 5, remains subject to approval by the flag carrier’s shareholders and the national competition authorities but is expected to see the budget airline purchased outright. Both companies will continue to fly under their existing brands, delivering a combined 3.8% share in the transatlantic market.
Commenting on the tie-up, Icelandair Group’s interim president and CEO Bogi Nils Bogason said: “WOW air has, in recent years, built a strong brand and enjoyed great success in the markets to and from Iceland and across the Atlantic. There are many opportunities for synergies with the two companies but they will continue to operate under their own brands and operating approvals. The tourism industry is one of the cornerstones of the Icelandic economy and it is important that flights to and from Iceland will remain frequent.“
Skúli Mogensen, CEO and founder of WOW air, added: “I am very proud of the success and development that we at WOW Air have enjoyed in the past few years and I am thankful for the response we have received since our very first flight. We have created a strong team that has reached remarkable success and has been a pioneer in low cost flights across the North-Atlantic. A new chapter now starts where WOW air gets an opportunity to grow and prosper with a strong backer like Icelandair Group that will strengthen the foundations of the company and strengthen its international competitiveness even further.“
Icelandair explained that the acquisition “creates opportunity for both companies to become even better prepared to provide international carriers with strong competition in the international airline market.”