Norwegian Snaps up Regional Associate Widerøe
Norwegian (DY) hopes to complete the deal to acquire Widerøe (WF) by Q4 2023, subject to regulatory approval.
Norwegian (DY) hopes to complete the deal to acquire Widerøe (WF) by Q4 2023, subject to regulatory approval.
DALLAS - Low-cost carrier Norwegian (DY) has announced it will purchase regional airline Widerøe (WF) in a deal valued at US$105m. The move comes as DY continues to rebuild after the launch of long-haul services almost led to its collapse.
Described by DY CEO Geir Karlsen as a “milestone in Norwegian aviation history,” the two carriers will continue to operate as individual companies but will streamline their networks to offer closer integration.
“Our two airlines have existed side by side for many years, and no one knows the aviation market in Norway better. With this transaction, we will now create a streamlined and more comprehensive offer for all customers, and we look forward to offering seamless travel across our entire route networks,” Karlsen added.
Widerøe, Norway’s oldest aviation group, currently has a fleet of almost 50 aircraft. Operating 85 routes across Norway, the carrier holds around 20% of the country’s domestic market. Meanwhile, Norwegian serves over 300 routes to 114 destinations, twenty-two of which are domestic. From these 107 Norwegian domestics, only five overlap meaning the two carriers can ‘complement each other well.’
Stein Nilsen, CEO of Widerøe, said, “Widerøe has a close to 90-year history, and we are the guarantor of a well-functioning route network in regional Norway. Although we have a solid footprint in Norway, we are smaller in an international context. The tax level for air travel in Norway is particularly high, and this, in combination with fierce international competition, makes it difficult for a smaller regional airline to persevere without a strong partner.
“We are therefore very happy to now join forces with Norwegian, and we are excited to get an industrial owner that aspires to develop both companies further. We are convinced that this solution is in the best interest of Widerøe, our employees, and not the least our customers.”
Regulatory bodies will now need to approve the deal, which DY hopes to complete by the end of the fourth quarter. The press release added that the ‘purchase price is subject to certain adjustments after closing, including in respect to the profitability of Widerøe in 2023.’
https://airwaysmag.com/norwegian-q1-2023-loss-summer/
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