Another budget airline goes out of business


UPDATE

Another European budget airline has gone out of business, underlining just how important it is that flyers make sure they have proper travel insurance.

Cash-strapped Wow Air earlier this week cancelled flights amid fears for the future of the carrier after a potential rescue deal with rival Icelandair collapsed.


On Thursday came an official announcement: Wow Air has ceased operation. All Wow Air flights have been cancelled. Passengers midway through their trips were told they will need to find alternative ways home.



Wow Air was an Icelandic low-cost carrier operating services between Iceland, Europe and North America. The airline was headquartered in Reykjavík.



Icelandair had reopened talks with Wow after the low-cost carrier lost the support of a potential US financial backer last week, but discussions subsequently stopped.

Wow Air had been given until March 29 to present a rescue plan to its lenders. It had hoped US private equity fund Indigo Partners would stump up $75 million in exchange for a 49% stake in the airline, but that deal fell through last week.

The airline, which operated low-cost flights from the UK to Reykjavik and onwards to the US and Canada, had been shedding unprofitable routes since late last year. 


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