Icelandair Group has announced an agreement to acquire fellow Icelandic carrier Wow Air.
The deal is subject to approval by shareholders and the Icelandic competition authorities, and will see the combined group control around 3.8 per cent of the transatlantic market.
Bogi Nils Bogason, Interim President and CEO, Icelandair Group, said that “There are many opportunities for synergies with the two companies but they will continue to operate under their own brands and operating approvals”, stating that Wow Air had built a strong brand “and enjoyed great success in the company‘s markets to and from Iceland and across the Atlantic”.
Commenting on the news Skúli Mogensen, CEO and founder of Wow Air, said:
“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.”
In recent weeks Wow Air had been forced to cut several US routes including St Louis, Cleveland and Cincinatti, leading to speculation that the carrier had over-expanded.
Icelandair and Wow Air overlap on several routes, and there is bound to be service consolidation – Business Traveller will provide further update when it becomes available.