Norwegian (DY, Oslo Gardermoen) has confirmed that its debt restructuring is complete and that a credit guarantee from Norway’s government of NOK3 billion kroner (USD302 million) has been approved.

It has now converted NOK12.7 billion (USD1.28 billion) of debt to equity. It has “laid a solid foundation for the future, although the next months will remain challenging,” the company said in a statement on May 20.

“Now that we can access the state loan guarantee, we can continue to transform the company. Through this process, the belief in New Norwegian and the company’s strategy have been confirmed by shareholders, the market, bondholders, leasing companies, and other creditors and lenders. Nevertheless, [...] Norwegian will still need to collaborate closely with a number of creditors as the company currently has limited revenues,” said CEO Jacob Schram.

The Norwegian government confirmed that the rescue loans deal had been completed, according to the news agency NTB.

In early May, bondholders, lessors, and shareholders agreed to the debt conversion and share sale, a key condition to receiving the state aid.

The deal means that lessors have collectively taken a majority of Norwegian’s capital after converting lease obligations into shares, with AerCap now holding a 15.9% stake and BOC Aviation, which is controlled by state-owned Bank of China, holding 12.67%, Reuters reported. Smaller firms, such as Avolon and DP Aircraft took lesser stakes.

“Lessors went with the least unpalatable option,” a source close to one of the companies told Reuters, explaining that the alternative, Norwegian’s bankruptcy, would have thrown a glut of used aircraft into the market.

The “new” Norwegian will operate seven aircraft for the coming year before eventually reaching 110 to 120 in 2022. That compares with 148 (79 leased and 69 owned) before the crisis.