Norwegian Air plans share sale in bid to survive

posted on 3rd December 2020 by Parveen Raja
Norwegian Air plans share sale in bid to survive

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Embattled carrier Norwegian Air today said that it was looking to raise 4bn Norwegian krone (£340m) in order to recapitalise the struggling firm.

In a statement to Oslo’s bourse, the low-cost carrier proposed a package of debt conversion, aircraft divestment and sale of new equity to get it through the coronavirus pandemic.

Norwegian did not rule out going back to the government for additional state aid, although the last time it did so it was rejected.

Having provided an initial package of around £300m in the spring, officials declined to extend extra support “for the time being”.

As a result, last month the airline sought bankruptcy protection under Irish law.

The process, called “examinership”, means that Norwegian’s creditors cannot take action to secure their payments until 26 February.

“The company asks for the continued support of its shareholders to prepare for future capital increases in parallel with the restructuring of its balance sheet through the above legal proceedings”, Norwegian said in a statement.

While other carriers have been ramping up operations since the summer in a bid to recover anything from 2020, Norwegian is currently flying just six or seven of its 140 planes.

For the third quarter, passenger numbers were down 91 per cent, forcing the carrier to furlough even more employees.