Wow Air Announces Details of Potential Indigo Partnership

Jan 16, 2019

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Icelandic ultra-low-cost carrier Wow Air has released new details regarding its potential partnership with its latest proposed financial savior, private equity firm Indigo Partners. [Update, 3/28/2019: WOW Air has ceased operations. Find our ongoing coverage of WOW Air’s collapse, and what affected passengers can do about it, here.]

According to a Jan. 9 letter to Wow Air bondholders obtained by Air Transport World, Wow founder and CEO Skuli Mogensen says Indigo is set to take a 49% stake in the struggling carrier in the form of a convertible loan. Wow has been struggling to get its financial house in order over the past few months, making cuts to both its routes and fleet. Despite its financial strife, Wow has not stopped announcing new cheap fares, like $49 tickets from US cities to Europe.

Indigo partners stepped up at the end 2018 to signal its interest in the Reykjavik-based airline. The latest announcement is now giving more details surrounding that possible arrangement. Under the current agreement, Indigo is set to invest as much as $75 million in Wow. At the time of the first announcement, there was no indication as to how big of a stake in the airline that sum would give Indigo. The loan would have a 10-year maturity, and the total amount invested will depend on the actual needs of the airline. That initial ownership stake could be increased during the term of the loan from Indigo.

The airline and Indigo are still in negotiations on how to deal with a current outstanding loan “from a current shareholder,” who is most likely Mogensen, who said in the past he has floated the airline at least 5.5 million euro to keep it afloat. Negotiations are focused around converting that current loan to equity or leaving the loan in place before Indigo finalizes its investment.

H/T: ATW Online

Featured Photo by Wow Air.

American Express® Green Card

WELCOME OFFER: 30,000 Points

TPG'S BONUS VALUATION*: $600

CARD HIGHLIGHTS: up to $100 annual CLEAR statement credit, up to $100 annual LoungeBuddy statement credit, 3x points on travel and transit, 3x points on restaurants worldwide

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 30,000 Membership Rewards® points after you spend $2,000 on purchases on your new Card in your first 3 months.
  • Earn 3X Membership Rewards® points on all eligible travel, from subway swipes and window seats to hotel stays and city tours.
  • Earn 3X Membership Rewards® points at restaurants worldwide.
  • Receive up to $100 per year in statement credits when you use the American Express® Green Card to pay for your CLEAR® membership at select airports and stadiums across the U.S. and Permissible Biometric Scanning Technology terms: eye scanning, irises scanning and fingerprints scanning.
  • Use the American Express® Green Card to purchase lounge access through LoungeBuddy to any of the lounges in the LoungeBuddy network – no memberships, elite statuses, or first class tickets required. Earn up to $100 in statement credits per calendar year on your LoungeBuddy purchases.
  • No Foreign Transaction Fees.
  • $150 Annual Fee.
  • Terms Apply.
  • See Rates & Fees
Intro APR on Purchases
N/A
Regular APR
See Rates & Fees
Annual Fee
$150
Balance Transfer Fee
See Terms
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.