Norwegian Air Shuttle Secures Approval for Widerøe Acquisition

The Norwegian Competition Authority (NCA) has given the green light to Norwegian Air Shuttle’s acquisition of Widerøe, Norway’s oldest aviation group. The approval, granted on December 21, 2023, marks a significant milestone for both airlines, opening up new horizons in the Norwegian aviation industry.

Widerøe, boasting a rich legacy as Norway’s oldest aviation group, employs over 3,500 individuals and operates a fleet comprising almost 50 aircraft. Its extensive route network, particularly in regional Norway, presents a unique opportunity for Norwegian Air Shuttle to enhance its offerings and create a more comprehensive experience for its customers.

The NCA’s decision comes after a period of careful consideration and scrutiny. On November 17, 2023, the NCA issued a Statement of Objections (SO) to the parties involved, expressing concerns that could potentially lead to the prohibition of the acquisition. The primary issues raised were related to the overlapping routes between Norwegian and Widerøe, prompting unilateral effects concerns. Additionally, there were apprehensions about potential price coordination between Norwegian and SAS on domestic flights, raising competition-related red flags.

Related: Norwegian Competition Authority Approves Norwegian Air’s Acquisition of Wideroe

A critical element of the NCA’s case was an econometric analysis that closely followed the model used in the Ryanair/Aer Lingus merger decision in 2007. Norwegian responded to the SO with its own econometric analysis conducted by CRA (Charles River Associates), demonstrating that the concerns raised by the NCA regarding unilateral effects were unfounded. The analysis presented by Norwegian aimed to allay fears of potential anti-competitive practices, particularly the coordination of prices with rival SAS.

The approval from the NCA is seen as a nod to the arguments presented by Norwegian, emphasizing that the acquisition of Widerøe will not adversely impact competition in the domestic aviation market. The comprehensive route network provided by Widerøe is expected to benefit Norwegian customers by offering a wider range of travel options within Norway.

The acquisition is poised to reshape the Norwegian aviation landscape, bringing together two major players to create a more robust and competitive industry. With regulatory hurdles cleared, Norwegian Air Shuttle and Widerøe can now move forward with their strategic plans, promising innovation and improved services for the benefit of air travelers across Norway.