Iceland's upstart ultra-low-cost carrier WOW Air, which has been catching eyes and travelers with its super-low fares and purple-themed planes will now operate as part of Icelandair, the big fish in the Iceland air travel market.
Both airlines operate as trans-Atlantic carriers, with all America-to-Europe itineraries including a stop, and an optional free stopover, in Iceland. Both have been expanding U.S. routes, often to the same cities, but competing at different price points. WOW Air has offered flights as low as $99 one way.
If the deal, valued at about $18-25 million, is approved by Icelandair shareholders and by regulators, the two will operate separately, with Icelandair continuing in the full-service market, with business-class seats, more amenities, and higher fares. WOW, which began operating in 2012, is privately owned by Titan Investments, which is owned by WOW founder Skuli Mogensen.