Compatriot airlines to strike new deal, writes Anthony Pearce.
Icelandair has agreed to acquire Wow Air in a deal that is believed to be worth up to $25 million.
Low-cost long-haul carrier Wow Air was founded in 2011 by Skuli Mogensen, and is also based in Iceland.
The deal, which was announced on Monday, is subject to approval by shareholders and the country’s competition authority.
“Icelandair Group has entered into a share purchase agreement to purchase all shares of airline WOW air,” it said in a statement.
Mogensen, Wow Air founder and chief executive, said: “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.”
Bogi Nils Bogason, Icelandair chief executive and interim president, added: “Wow Air has in recent years built a strong brand and enjoyed great success in the company‘s 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.”