Indigo Partners Reportedly Interested In Thomas Cook’s Condor

The German subsidiary of now defunct Thomas Cook could be on the brink of getting a valuable lifeline. US equity firm, Indigo Partners, is reported to be interested in buying the airline. While having the backing of such a powerful investor could be great for Condor, it remains to be seen if a deal can be reached that is suitable for both parties.

Condor
Could Condor be saved by a US investor? Photo: Eric Salard via Flickr

Following the collapse of parent company Thomas Cook, the future for the German leisure airline has been looking rather shaky. Condor was just this week approved for a €380m injection of cash from the German government, which perked things up a bit. But with the transaction still to face the scrutiny of the EU, many question marks remained.

Now, it seems a US investment firm could swoop in and secure a healthier future for Condor, as Indigo Partners are reportedly re-igniting their interest in the struggling airline.

Indigo Partners want to expand in Europe

The private equity firm is a well-known brand across the pond, but is less prevalent in Europe. In the US and South America, Indigo owns well known carrier Frontier Airlines, as well as Chilean JetSmart and Mexican Volaris. The company is working up a partnership in Canada with Enerjet also.

Indigo partners airlines
The Indigo Partners airlines. Photo: Airbus

Over in Europe, the firm’s only holding is in Hungarian Wizz Air. Indigo has long been keen to establish a presence in the west of Europe, having bid for Wow Air, but later dropping out of the process.

Now, it seems they could be considering adding another airline to their stable, as Handelsblatt reports they are interested in making a play for Condor. With Indigo’s focus on ultra low cost carriers in the leisure market, Condor doesn’t quite fit the usual model for Franke’s team, but nonetheless could be an interesting addition to the portfolio.

Would an Indigo purchase be good for Condor?

If Indigo Partners invest in Condor, it wouldn’t be good for the airline; it would be great. The clout of such a large investor, not to mention their willingness to bankroll airline improvements, could help Condor turn things around and become a solid low cost carrier in the European market.

Back in 2017, Indigo Partners placed one of the largest aircraft orders in the history of civil aviation. At the Dubai Air Show in November that year, billionaire Bill Franke signed up for no less than 430 Airbus planes, all of the A320 family, for the Indigo group of airlines.

Condor 767
Condors aging fleet of 757s and 767s are ripe for retirement. Photo: Alicia Fagerving via Wikimedia

Condor is desperately in need of some new aircraft for its ops. Its fleet of 53 aircraft includes 31 757s and 767s with an average age of 20 and 24 years respectively. These aircraft are ripe for retirement, and Indigo’s huge backlog of A320 family aircraft could help the airline claw its way back to being a profitable operation.

The power of a company the size of Indigo could benefit Condor in other ways too. Franke has a solid reputation with banks and lending vehicles, not to mention a large influence with manufacturers too. His ability to negotiate lower leasing rates could prove to be vital to Condor in terms of a swift refreshment of its fleet.

Will they bid?

The main issue for Indigo Partners is that, as a US based company, they are not allowed to own a majority share in any European airline. This means they’ll need to think carefully about how to construct the deal.

Indigo Partners had expressed their interest in Condor back in May, when Thomas Cook first tried to sell off its airline business. It’s highly likely that they will look to purchase again, but the deal will have to be right. Whether Lufthansa reignite their interest in the German charter airline remains to be seen, but if they do, Indigo could be up against some stiff competition.

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