Investors face heavy losses as PLAY founders launch buyout bid

Two of the largest shareholders in Icelandic airline PLAY, CEO Einar Örn Ólafsson and Deputy Chairman Elías Skúli Skúlason, have announced plans to launch a takeover bid for all outstanding shares of the company at a price of 1 ISK per share, with the intention of delisting the airline from the stock market.

This offer, valuing the company at approximately ISK 1.89 billion based on its current share count, includes the option for shareholders to receive either cash or shares in the takeover company, BBL 212 hf.

The announcement was made in a notice submitted to Nasdaq Iceland after markets closed yesterday. According to the statement, funding is currently being secured for the transaction. The takeover company aims to raise a minimum of USD 20 million (ISK 2.5 billion), of which around USD 7 million (ISK 880 million) has already been committed, including in the form of loan facilities.

The buyers have secured support from 20% of current shareholders, but the offer is conditional on receiving 90% approval. Financial services firm Arctica Finance is advising on the deal. The offer will not be formally submitted until the full USD 20 million in funding is secured — leaving about USD 13 million still to be raised.

Nearly 97% value lost since listing

PLAY’s stock has plummeted nearly 97% since it was listed on the First North market in summer 2021, when the IPO price was ISK 18 per share. The company was later moved to the main market in 2024. PLAY has struggled financially, repeatedly raising capital and restructuring its business model in an effort to find a sustainable path forward.

After an initial post-IPO surge, with shares briefly exceeding ISK 20, the stock began a steady decline. At the start of 2022, the share price was ISK 23.7, but it ended that year at ISK 13.1. By the end of 2024, it had dropped to ISK 1, hitting a low of ISK 0.64 on March 12, and closing at ISK 0.81 yesterday.

With this planned takeover and delisting, many investors are expected to realize substantial losses. One of the largest shareholders, Birta Pension Fund, holds a 10.35% stake in the company. Still, the offer price represents a 24% premium over yesterday's closing price.

Strategic shift: Sun destinations and leasing

According to the announcement, the company will be delisted, discontinue U.S. routes by October 2025, and shift focus to sun destinations and aircraft leasing. Four aircraft will continue serving Iceland routes, while six others will be leased to foreign operators.

The airline will operate under a Maltese air operator’s certificate, having returned its Icelandic license.

PLAY CEO Einar Örn Ólafsson emphasized that the move represents a practical restructuring of the airline's operations. “For PLAY shareholders, including pension funds, this marks the realization of multi-billion ISK losses,” he stated.

In the official announcement, Ólafsson said:

“Our focus going forward is on profitable segments of the business — sun destination flights — and we will discontinue operations that haven’t delivered results. We look forward to continuing to promote competition in the airline market with our red aircraft and Icelandic crews. Our primary goal remains to offer Icelanders affordable travel to sunny destinations.”