By Helwing Villamizar,
Norwegian Air Shuttle (DY) shares were trading 82% higher in Oslo today, offsetting this year’s stock price downfall of 97%.
On December 8, the Irish High Court granted creditor protection to Norwegian Air International (D8) and the Group’s Irish subsidiaries. The Court also extended the creditor protection to parent airline DY. The decision has helped spike the price of DY stock.
According to marketwatch.com, shareholders are expected to vote next week on a rescue plan that calls for further stock issuance, cutting the conversion of DY’s fleet and debt as part of its restructuring process.
The process of examinership in Ireland allows financially sustainable businesses to address elements of the business that require restructuring with the aim of protecting jobs and preserving the core values of the business.
This protection allows a company to secure new capital and implement a legally binding scheme for the settlement of debts. While the examination takes its course, NAX will receive creditor protection, meaning that the airline has more time to restructure. After the Norwegian Government declined funding to NAX, the group applied for Protection under Irish Court.
DY appeared in court in Ireland, having filed for bankruptcy protection late last month. According to The Irish Times, the creditors for the Irish subsidiaries had threatened legal action against the airline. Said legal action was related to defaulted or late payments on the aircraft used by the Irish subsidiaries.
After Tuesday’s ruling, it seems DY has been given a chance to breathe, time to restructure and the means to fulfill its financial commitments.