Wow Air has seemingly been saved by a potential acquisition deal with low-cost carrier investor Indigo Partners.

The Icelandic airline has signed an agreement in principle with Arizona-based Indigo Partners, which also owns Hungarian Wizz Air, US-based Frontier Airlines, Jetsmart in Chile and Volaris in Mexico.

Both parties aim to complete the deal “as soon as practicable”, according to Wow Air, and its CEO Skuli Mogensen would remain a principal investor in the airline.

The news will be very welcomed by Wow Air, which suffered a blow when it agreed with Icelandair to abandon a take-over deal because certain conditions could not be met. The carrier also had to return four aircraft to lessors after they “demanded stricter payment terms than before”.

Bill Franke, managing partner of Indigo Partners, commented: “Skuli and Wow’s management and employees have done a remarkable job in creating a well-regarded, successful ULCC (ultra low-cost carrier) brand. We have a strategic vision for the airline, and look forward to working with its employees and agents to deliver that vision.”

Mogensen added: “The demand for low-cost air service continues to expand rapidly worldwide, and with Indigo as a partner, we hope to take full advantage of this highly attractive market segment. I am excited to work with Indigo and I am convinced it is the best long-term move for our people and passengers.”

Wow Air is being advised by US-based Plane View Partners.

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