Norwegian Air eyes Monarch Airlines deal, sources say
The Press Association understands that Norwegian Air Shuttle has approached Monarch over a deal to buy all – or part – of the business.
The owner of Norwegian Air is understood to have entered the race to secure a tie-up with Monarch Airlines in an attempt to snatch a bigger slice of Britain’s low-cost travel market.
Norwegian Air Shuttle has approached Monarch over a deal to buy all – or part – of the business as it looks to up the pressure on rivals easyJet and Ryanair, sources have told the Press Association.
It follows reports that Monarch, which is owned by private equity firm Greybull Capital, has hired KPMG to investigate options for overhauling, or selling, its short-haul business with an eye to focusing on more lucrative long-haul routes.
The Luton-based carrier is said to be exploring a joint venture or a feeder deal with an outside airline, Sky News reported on Monday.
Industry sources told PA: “It is widely known that the UK is a key market for Norwegian where the airline is looking for opportunities to expand.”
Norwegian Air is keen to bolster its global network and recently struck an agreement so easyJet customers could access its long-haul routes.
The Scandinavian airline, which carries 30 million passengers a year, has ordered 200 new aircraft to boost its fleet of 140.
It has also explored a long-haul flight deal with Ryanair, but talks between the airlines collapsed.
Ryanair’s chief executive, Michael O’Leary, has claimed that Norwegian is not financially sound, which the Oslo-based carrier dismissed as “nonsense”.
Norwegian, which has been offering £99 flights from Edinburgh and Dublin to New York, has hired more than 140 pilots from Ryanair this year.
Meanwhile, Ryanair is facing a multimillion-pound compensation bill for cancelled flights following a crisis over pilot shortages.
The Dublin-based carrier revealed that it would shelve up to 50 flights every day over the next six weeks because of an over-allocation of pilots’ holidays during a relatively busy period.
It comes as the British airline industry grapples with a sustained bout of turbulence driven by sterling’s slump and falling passenger numbers in the wake of a string of terror attacks.
Monarch secured a £165 million cash injection from Greybull in October last year, which allowed the low-cost carrier to renew its operating licence with the Civil Aviation Authority.
The British airline employs around 2,750 staff and flies to more than 40 destinations.
In a statement Monarch said: “In recent months we have undertaken, and continue to undertake, a comprehensive review of Monarch, designed to determine its optimal future shape, size and strategy.
“We are having regular discussions on a number of options with potential strategic partners and we will announce any material developments, if and when they happen.”
A Norwegian Air spokesman said: “We don’t comment on speculation.”