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. For an explanation of our Advertising Policy, visit this page.

Don’t count Wow Air out just yet.

[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.]

Even though the struggling ultra-low-cost carrier has been cutting routes, selling off 20% of its fleet and attempting to negotiate a failed buyout from Icelandair, it might have found a new financial savior willing to step up in the nick of time to save the airline from a seemingly imminent demise.

Indigo Partners, the private equity firm that owns budget airline Frontier, said Thursday it plans to buy a stake in the faltering Reykjavik-based carrier. The two aviation groups said they have reached a preliminary agreement, the specific terms of which were not disclosed. But if the deal goes through after due diligence, Wow’s CEO Skuli Mogensen would remain the airline’s primary shareholder.

National flag carrier Icelandair had originally offered to buy Wow, but its preliminary purchase agreement laid out several stipulations that the purple-liveried carrier had to complete by the Icelandair shareholders’ meeting on Nov. 30 or the deal would not go through. And it seems that Wow wasn’t able to hold up its end of the bargain.

Now the question is whether the airline’s shaky balance sheets, exacerbated by the recent record-high cost of jet fuel, will pass Indigo Partners’ due diligence.

If it can manage to cement the private equity investment, Wow will be in capable hands.

Indigo Partners not only owns Frontier, but also invested in fellow ULCC Spirit Airlines when it was struggling, and is widely credited with turning around the airline’s bottom line. Spirit is now one of the most profitable airlines in the ultra-budget sector, posting a third quarter net income of $97.5 million in 2018.

“We have a strategic vision for [Wow], and look forward to working with its employees and agents to deliver that vision,” Bill Franke, managing partner of Indigo Partners, said in a statement.

The firm is also currently a lead investor in international ultra-low-cost carriers Wizz Air, Volairs and JetSMART.

Featured image courtesy of WOW Air.

Know before you go.

News and deals straight to your inbox every day.

2018 TPG Award Winner: Mid-Tier Card of the Year
Chase Sapphire Preferred® Card

NEW INCREASED OFFER: 60,000 Points

TPG'S BONUS VALUATION*: $1,200

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*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 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 60,000 points are worth $750 toward travel
Intro APR on Purchases
N/A
Regular APR
18.24% - 25.24% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

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.