Icelandic LCC WOW Air has disclosed that US private equity firm Indigo Partners is looking at an initial 49% investment, although this could be increased at a later date.
Indigo Partners emerged as a potential investor in WOW Air in November 2018, after Icelandair’s plans to acquire its rival collapsed.
At the time, an investment value of up to $75 million was announced, although no details were given about the percentage shareholding that Indigo was planning to take.
In a Jan. 9 letter to bondholders, WOW Air founder and CEO Skuli Mogensen gave further details about the planned deal.
“The initial shareholding of Indigo Partners will be 49%. Subject to foreign ownership regulations, Indigo Partners could obtain additional equity should the conversion option be exercised during the tenor of the loan,” Mogensen said in the update.
The investment will “primarily” be a convertible loan, with a 10-year maturity, and the sum invested will depend on the capital needs of the business…