Almost all Norwegian’s fleet remains grounded as the airline seeks bankruptcy protection in Ireland … [+] in a last-ditch attempt to save itself.
Struggling Norwegian Air has filed for bankruptcy protection in Ireland just days after the government of Norway declined to pump cash into the airline. The Irish court will oversee further restructuring of its debt, which the airline says needs to happen to avoid operations ending in early 2021.
If accepted, the protection will give the airline a maximum of five months in which to shed debt, sell assets and seek fresh capital. In the event the company succeeds, the Norwegian that emerges will likely be a much smaller, leaner airline focused on Norway and Scandinavia.
Norwegian’s already rock bottom share price tumbled after the news. After a volatile day’s trading on the Oslo Stock Exchange, the share price finished the day down 15.7%.
The bankruptcy protection process is not guaranteed
The airline has sought Irish protection for its subsidiaries Norwegian Air International and Arctic Aviation Assets, under the examinership process. This is similar to Chapter 11 in the U.S.
The international subsidiary was Norwegian’s first foreign subsidiary and is technically a different airline, operating many routes outside of Norway under a different air operator certificate despite using the same branding. However, Norwegian said the entire group will be protected as a related party by the Irish process.
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Norwegian Air’s CEO Jacob Schram and CFO Geir Karlsen have a maximum of 150 days to save the … [+] airline.
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