Iceland’s PLAY will cease all services to North America later this year, after two of the airline’s largest shareholders announced a proposed takeover offer for all outstanding shares in the company
The airline confirmed that from October, all three of its North American routes will be dropped. PLAY currently operates services from Reykjavik to New York, Boston and Baltimore.
In addition to the axing of these routes, PLAY will also reduce its network in Northern Europe, focusing on what it describes as “sunny destinations”.
This planned restructure, led by the airline’s CEO Einar Örn Ólafsson and vice chairman of the board Elías Skúli Skúlason, will see the PLAY’s fleet cut from ten aircraft to four, with the remaining six aircraft leased out. PLAY confirmed that passengers flying from Iceland will not notice any changes in service, with the airline’s branding and aircraft appearance remaining the same.
The takeover group will offer one Icelandic Krona ($0.0080) per share, and sellers may choose to receive payment either in shares of the new company or in cash.
As part of the plan, PLAY will also delist from the Icelandic stock exchange.
“This is primarily a plan for practical changes to the operations of the Icelandic airline PLAY. We’re focusing on the profitable aspects of the business - sun destination flights - and discontinuing those that have not yielded results,” said Ólafsson. “We look forward to continuing to foster competition in the aviation market with our red aircraft and Icelandic crews. Our main goal remains to offer Icelanders affordable flights to the sun.”
The acquiring entity will be funded with a minimum investment of $20 million, of which commitments have already been secured for more than one-third, the airline stated.