The Icelandic airline Icelandair has reached an agreement to take over its
rival Wow Air. The two Icelandic companies will continue to operate as
separate brands, according to the Icelandair Group.
 
Both Icelandair and Wow Air sell cheap flights from Europe to North America
with transfer in the Icelandic capital Reykjavik. That airport is mainly
used by the two price breakers. On the whole transatlantic market, however,
they only have a combined market share of around 3.8 percent.
 
Icelandair had to confess last week that it had violated one of its debt
covenants and had to ask bondholders to temporarily turn a blind eye. The
much younger Wow Air is also in awkward papers. It has been losing money
for several years and sought a partner to get through the difficult winter
months, now that oil prices are rising.
 
Icelandair shareholders will be able to vote on the deal in the coming
days, Wow Air is valued at $ 18 million (15.8 million Euro). After that,
the Icelandic competition authority must also give the green light.

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