Norwegian Air restructuring plan wins state approval
Norwegian Air’s restructuring proposals have today been approved in the carrier’s home country courts, clearing the way for it to begin raising fresh capital.
The airline said that Oslo’s County Court had this morning joined the Irish High Court’s decision to give its plans the go-ahead.
After its government refused to extend further support to the embattled carrier in the autumn, Norwegian was forced to seek bankruptcy protection.
The coronavirus pandemic, which saw air travel all but dry up around the world, forced the carrier’s already-stretched finances to crisis point.
But with the courts’ approval the airline can now focus on raising 4.5bn Norwegian crowns (£385m) from new shares and hybrid capital.
The new plan has received the backing of government officials, who said it was “more robust” than the proposal it previously rejected.
In order to come out of the pandemic, Norwegian will it cut its fleet to 50 planes and stop long-haul services.
As a result of stopping its long-haul services, through which it established a foothold in the lucrative transatlantic market, around 2,000 staff will lose their jobs, including 1,100 in the UK. Norwegian will also close its base at Gatwick airport.
Speaking today, chief executive Jacob Schram said: “We are very pleased with this important positive decision by the court. Once we have passed these two biggest legal milestones we can look forward to continuing the work of raising new equity.
“I stand very proud of the achievements that Norwegian has accomplished throughout this period and I am grateful to work alongside so many colleagues that have shown such unwavering commitment and determination for us to succeed.
“At the same time, I wish to recognise the crucial support that we have received which has enabled us to continue our business.”