Tag: Franke

Wizz Air Looks to Connect the Dots with Long-Range A321’s

June 19, 2019 / WIL BALDWIN

LE BOURGET, France, June 19 (Reuters) – Wizz Air will use 20 new extended-range, narrow body Airbus jets primarily to connect existing destinations in its disparate network rather than to fly to new places, the budget airline’s Chief Executive Jozsef Varadi said on Wednesday.

Indigo Partners, the private equity firm of veteran low-cost airline investor Bill Franke, agreed on Wednesday to acquire 50 of the new long-range version of Airbus’ A321neo jet, 20 of which will go to Wizz.

Wizz, which operates a fleet of 113 Airbus A320 and Airbus A321, would not need to change its operating model to accommodate the new A321XLR jets, Varadi said, as it would be able to fly essentially the same planes a little longer.

“Our network spans from the Canary Islands to Astana in Kazakhstan, from Reyjavik in Iceland to Dubai,” Varadi told Reuters after the announcement at the Paris Airshow.

“The XLR gives use the opportunity to connect more dots in our existing network. This is what we’re looking at.”

Airbus opened the Paris Airshow with the launch of the A321XLR, but the announcement was overshadowed on Tuesday when Boeing said British Airways-owner IAG intended to order 200 of its grounded 737 MAX jets.

Hungary-based Wizz, which is focussed on central and eastern Europe, said it had used existing option positions to secure the deal for the A321XLRs, bringing the airline’s total of outstanding firm orders for Airbus aircraft to 276 jets.

Varadi said that in the longer term, it was possible the jet would help open routes to new destinations, but it was not a priority.

“We have always been excited about planting new flags in new territories,” Varadi said. “But the vast majority of the XLR capacity will come in existing markets.”

(Reporting by Alistair Smout; Editing by Mark Potter)

Thomas Cook Sets May 7 Deadline for Airline Interest

May 1, 2019 / WIL BALDWIN

LONDON (Reuters) – Thomas Cook has set a deadline of May 7 for expressions of interest in its airline business, with Indigo Partners and Lufthansa among the likely bidders, sources said.

The heavily-indebted British travel group put its profitable airline business up for sale in February after profit warnings in 2018 left it needing to raise cash.

Thomas Cook’s airlines business consists of Germany’s Condor, as well as British, Scandinavian and Spanish operations.

A sale of the business, in whole or in part, would enable the world’s oldest tour operator to invest more in its own hotels and improve its online sales.

A source familiar with the discussions said that Indigo and Germany’s Lufthansa appeared most interested in the business.

British Airways owner IAG should not be ruled out and easyJet has engaged in talks but is seen as less interested, the source added.

It is not clear whether Ireland’s Ryanair would bid.

Another source said that private equity groups KKR and Apollo might also look at taking over the whole of Thomas Cook.

The airlines business would provide access to valuable European slots linking Britain to Spain, Greece and Turkey.

Thomas Cook, Indigo, IAG and easyJet declined to comment, while Lufthansa and Ryanair were not immediately available.

Lufthansa executives have said repeatedly that the German airline wants to “play an active role” in consolidation.

Indigo, the private equity firm managed by Bill Franke, the veteran U.S. low-cost airline investor, has previously made investments in several airlines including Hungary’s Wizz.

Thomas Cook has been revamping different parts of its business this year, closing high street stores and reviewing its money division as it focuses on holidays.

The company was hit badly in 2018 when a hot European summer deterred customers from booking holidays through the year.

One banking source said the airline would fetch less than 1 billion euros (£859 million). Thomas Cook has a current market value of just over £400 million.

Sources said that competition issues could influence which parts of the business different suitors go for.

Sky News has said China’s Fosun International, a Thomas Cook shareholder, was interested in its tour business.

(Reporting by Kate Holton and Clara Denina in London; additional reporting by Alistair Smout and Georgina Prodhan in London and Arno Schuetze in Frankfurt; Editing by Alexander Smith)

FILE PHOTO: A Thomas Cook Airbus A321-200 airplane takes off at the airport in Palma de Mallorca, Spain, July 28, 2018. REUTERS/Paul Hanna/File Photo

Passengers Stranded After Iceland’s WOW Air Collapses

March 28, 2019 / WIL BALDWIN

FILE PHOTO: Bikes by bike rental service of Icelandic airline WOW air are seen in Reykjavik — FILE PHOTO: Bikes by a bike rental service of Icelandic airline WOW air are seen in Reykjavik, Iceland, August 5, 2017. REUTERS/Michaela Rehle/File Photo

(Reuters) – Iceland’s WOW air became the latest budget airline casualty on Thursday, halting operations and cancelling all future flights after efforts to raise more funds failed.

WOW, which focussed on low-cost travel across the Atlantic, advised stranded travellers to seek flights with other airlines. It flew a total of 3.5 million passengers last year.

“This is probably the hardest thing I have ever done but the reality is that we have run out of time and have unfortunately not been able to secure the funding of the company,” WOW CEO and founder Skuli Mogensen wrote in a letter to the company’s 1,000 employees.

“I will never be able to forgive myself for not taking action sooner,” he added.

WOW had earlier postponed flights on Thursday as it entered what it had hoped were the final stages of an equity raising with a group of investors.

“My flight from Boston has been cancelled. Having a hard time getting through to anyone on the phone. Can you help me at all?” Twitter user Marc Solari wrote.

WOW replied with an apology and offer of further assistance.

WOW is the latest budget airline to collapse as the European airline sector grapples with over-capacity and high fuel costs. Recent failures include Britain’s Flybmi, Nordic budget airline Primera Air and Cypriot counterpart Cobalt.

“RESCUE FARES”

Other airlines including, Icelandair, Easyjet and Norwegian stepped in offering discounted ‘rescue fares’ to stranded passengers, according to the Icelandic Transport Authority

WOW has been pursuing different avenues to raise money over the past few months.

It ended talks with rival Icelandair last Sunday while veteran low-cost airline investor Bill Franke also had cancelled a proposed investment through private equity fund Indigo Partners.

Icelandair shares traded up 13 percent percent at 1215 GMT after the failure of a competitor.

Founded in 2011 by entrepreneur Mogensen, WOW used smaller single-aisle planes to fly between Iceland and many destinations in the United States and Europe.

Its website had advertised flights from London to cities such as New York and Boston for as little as 150 pounds, although the journey went via the Icelandic capital Reykjavik.

Norwegian Air has a little over half of the market share in the fast-growing, low-cost, long-haul transatlantic market, while WOW controlled a quarter in 2018.

There are fears of a knock-on effect on Iceland’s important tourism industry.

Around 30 percent of tourists visiting Iceland last year flew with WOW and the collapse could trigger a 16 percent drop in tourists this year, research from Icelandic bank Arion showed.

( By Stine Jacobsen and Tommy Lund; editing by Darren Schuettler/Keith Weir)

Wizz Air Looks to Connect the Dots with Long-Range A321’s

Thomas Cook Sets May 7 Deadline for Airline Interest

Passengers Stranded After Iceland’s WOW Air Collapses

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