Norwegian rummages for more funding solutions

Norwegian wins gov’t backing for plan - with conditions

Norway’s government has announced that it supports Norwegian’s new rescue plan to avoid bankruptcy, a change from its position adopted in October. The airline welcomed the move, which it said “significantly increases Norwegian’s chances of working through the crisis caused by the pandemic and position itself as a key player within Norwegian and European aviation.”

The centre-right coalition’s trade and industry minister, Iselin Nybø, revealed in a statement on January 21 that although the government “has no ambitions to become a shareholder” it “is positive about contributing money to a reconstructed Norwegian” as long as private investors do too.

The company’s plan to end long-haul flights, turning away from its base at London Gatwick to refocus on the Nordic region while significantly cutting debt and raising NOK4-5 billion kroner (USD474-593 million) in fresh capital, “seems more robust than the one we said no to in October. That is why we are now positive towards contributing,” Nybø said.

In light of the new business plan, which Norwegian outlined on January 14, the low-cost carrier subsequently asked...

Norwegian warns it lacks working capital; lessor wound up

The High Court of Ireland has wound up one of the five Irish-registered subsidiaries of Norwegian (DY, Oslo Gardermoen) given protection from creditors in November 2020, with the Irish Times reporting that a judge made the order to dissolve Torskefjorden Leasing late in the evening on January 15.

In the Norwegian company hierarchy, Torskefjorden is itself a subsidiary of aircraft owner Arctic Aviation Assets alongside Drammensfjorden Leasing and Lysakerfjorden Leasing.

It was involved in leasing aircraft to Norwegian’s long-haul business, and Justice Michael Quinn’s ruling followed the airline’s decision last week to halt its long-haul services, which prompted the examiner to the companies, Kieran Wallace of KPMG, to ask the judge to issue the order as part of Norwegian’s ongoing examinership process.

Wallace said he was broadly in agreement with Norwegian’s new restructuring plan and was continuing to evaluate it. He explained that the decision to end long-haul routes meant that Torskefjorden Leasing was no longer commercially viable.

Torskefjorden Leasing was a lessor of twenty-four B787 widebody jets, which it sub-leased to other...

Norwegian drops long-haul, cuts 2,160 jobs, to raise $590mn

Norwegian (DY, Oslo Gardermoen) will shut down its long-haul operations to focus instead on “a simplified business structure and dedicated short-haul route network” as it seeks to complete its debt restructuring, it announced in a statement presenting a new business plan on January 14.

The airline’s executives warned last month that they were contemplating giving up their once-prized long-haul business. The new plan, which is subject to approval by courts in Ireland as part of the ongoing the examinership process there, would cut Norwegian’s fleet from 140 aircraft today to around 50 narrowbody aircraft, raising that to about 70 in 2022.

“The company will build on [its low-cost] foundation, focusing on its core Nordics business, operating a European short-haul network,” it said, admitting that its entire B787 fleet had been grounded since March.

Norwegian pledged to cut its debt to NOK20 billion kroner (USD2.36 billion), while also raising between NOK4 billion and NOK5 billion (USD470-590 million) in new capital through a combination of three measures, a rights issue for current shareholders, a private placement...

Wizz Air threatens lawsuits in Norway over alleged boycott