Icelandair canceled the agreement made on November 5 to buy rival airlines WOW Air.
This happened two days after WOW Air announced that it was entering a restructuring process, which included stopping four aircraft from its fleet.
In a press release, the Icelandair Group stated: "[We have] issued a bourse release on Monday, November 26, which stated that the company estimates that it is unlikely that all provisions in the share purchase agreement will be met by the shareholders' meeting on November 30. The situation remained unchanged."
Both parties have agreed to cancel the takeover plan.
The planned acquisition of the Icelandair Group from WOW will not succeed. The Board of Directors and management of the two companies have worked on this project in earnest. This conclusion is certainly disappointing.Bogi Nils Bogason, President & CEO of Icelandair Group
This makes low-cost airlines Icelandic WOW Air one step closer to liquidity. Earlier this week, it confirmed that he suffered a decline in sales and published weak financial projections.
Then on Thursday, 'Airport Associates', the land handling provider for WOW Air, announced that they would lay off 237 employees, "[…] due to uncertainty about the future of the aviation market at Keflavik Airport."
Following the failure of Icelandair's investment in WOW Air, this low-cost airline announced a new agreement on Thursday night, this time with LCC Indigo Partners.
I like working with Indigo and I'm sure this is the best long-term step for our people and passengers.Skuli Mogensen, CEO of WOW Air
Indigo is a major investor in the aviation industry. The company has several low-cost operators, including Frontier Airlines and WizzAir. Details about the agreement with WOW Air have not been announced.
Read more: WOW Air enters the restructuring process, stopping several aircraft
This is a developing story. More to follow.
Flight journalist from Germany. Editor in Chief of the International Aviation Network.