On schedule, Norwegian (DY, Oslo Gardermoen) emerged on May 26 from its six-month restructuring process under bankruptcy protection, with less than half of its fleet remaining and its debt almost wiped off its balance sheet, it announced in a stock market filing.

The new-look low-cost carrier confirmed that it had fulfilled all conditions for leaving bankruptcy protection in Ireland and Norway. It has raised NOK6 billion kroner (USD720 million) in fresh capital as planned, beyond the minimum requirement set in the Dublin and Oslo bankruptcy courts.

Norwegian is now officially relaunched, with fewer flights and a focus on Norway and the Nordic region, but it faces stronger competition - against Wizz Air (W6, Budapest) and start-up Flyr (FOX, Oslo Gardermoen) as well as SAS Scandinavian Airlines (SK, Copenhagen Kastrup) - and lingering uncertainty about demand amid an ongoing pandemic.

“The effective date [...] will occur today,” Norwegian said in its May 26 disclosure. “The effective time [...] is subject to the registration of the share capital increases and the issuance of convertible loans pertaining to the capital raise with the Norwegian Register of Business Enterprises, expected to occur shortly after close of trading on the Oslo Stock Exchange today.”

During the restructuring, the company has managed to cut its total debt by around NOK64 billion (USD7.7 billion) to NOK16-18 billion (USD1.9-2.2 billion), of which NOK5.8-6.3 billion (USD700-758 million) is aircraft-related debt. Its cash balance, including restricted cash, is estimated to be about NOK7 billion (USD842 million).

It has cut its fleet from 156 aircraft to approximately 51 B737-800s, to be operated on a power-by-the-hour basis until the end of the first quarter of 2022, and “has terminated aircraft orders with Boeing and Airbus”, representing CAPEX commitments of some NOK85 billion (USD10.2 billion) in aggregated value.

The existing shareholders will, in principle, now have 4.6% ownership of the company, creditors 25.4%, and new investors 70%, although the latter may include the old shareholders’ possible participation in a planned share issue, the online business newspaper E24 Næringsliv reported.

During a hearing in Ireland before Easter, Norwegian said it believed it would emerge from restructuring with a total of 3,300 employees, from 10,215 employees at the end of 2018.

In related news, Norwegian’s Swedish airline subsidiary, Norwegian Air Sweden (LE, Stockholm Arlanda), is filing for bankruptcy, the Swedish daily Dagens Industri reported on May 25. Charlotte Holmbergh Jacobsson, Norwegian’s head of communications for Sweden and Finland, told E24 that the subsidiary, which has its own AOC, has no employees and that the bankruptcy application has no consequences for operations. The move is part of Norwegian’s restructuring process, she added.

“We had planned to liquidate the company as the company structure changed to a new, simplified structure. However, as it has debts that could not be settled during the restructuring, there is, unfortunately, no alternative than to file for bankruptcy for the Swedish company,” she said.

Editorial Comment: Removed the fleet summary information from the article and updated the planned fleet count to clarify Norwegian only plans to fly B737-800s going forward. - 27.05.2021 - 07:15 UTC