Icelandair has cancelled its agreement made on November 5th to purchase rival airline WOW Air.
This comes two days after WOW Air announced that it is entering a restructuring process, which included retiring four aircraft from its fleet.
In a press release, Icelandair Group stated: “[We have] issued a stock exchange release last Monday, November 26th, stating that the company estimated that it would be unlikely that all of the conditions in the share purchase agreement would be fulfilled by the shareholders’ meeting on November 30th. That situation remains unchanged.”
Both parties have agreed to abandon the takeover plans.
This brought the financially struggling Icelandic low-cost carrier WOW Air one step closer to liquidity. Earlier this week, it confirmed that it is suffering from decreased sales and published weakened financial projections.
Later on Thursday, ‘Airport Associates’, WOW Air’s ground handling provider, announced that it will lay off 237 employees, “[…] due to the uncertainty of the future of the aviation market at Keflavik Airport.”
Following the failure of Icelandair’s investment in WOW Air, the low-cost carrier has announced a new agreement on Thursday evening, this time with Indigo Partners LLC.
Indigo is a major investor in the airline industry. It owns several big low-cost carriers, including Frontier Airlines and WizzAir. Details on the deal with WOW Air have not yet been announced.
Read more: WOW Air enters restructuring process, retires several aircraft
Jakob Wert is an aviation journalist from Germany. He built up the website IFN.news and is the Editor-In-Chief of International Flight Network.