Norwegian plans debt restructure to survive pandemic
Norwegian is to hold an extraordinary meeting on May 4 to discuss a debt restructuring to ensure it meets criteria for a Norwegian Government guarantee scheme.
The airline has already grounded nearly all of its fleet and laid off around 90% of its staff to help survive the coronavirus crisis.
It is hoping to get NKr3 billion in state funding by putting certain measures into place, including converting parts of its liabilities towards lessors, banks and other creditors into shares, converting some of all bonds into shares, and a private stock placement.
"The proposed measures are necessary in securing the next tranches of the Norwegian government state guarantee program that will release NOK 3 billion. They are also necessary for the future of the company by strengthening the company’s balance sheet," said CEO Jacob Schram.
"We will over the next weeks engage in dialogue with the bond holders, lessors and other creditors, with the intent of converting substantial debt to equity. This will create a platform which will enable Norwegian to return to the skies as an even better and stronger company to the benefit of the travelling public, our dedicated colleagues and current shareholders. We have already started working on building the future ‘New Norwegian’ and that work will continue with full force the coming weeks."
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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