aviation industry

Shareholders back Norwegian Air rescue plan

Agence France-Presse

This is AI generated summarization, which may have errors. For context, always refer to the full article.

Norwegian Air Shuttle shareholders grant management the mandate to begin negotiations with creditors

Shareholders of struggling low-cost airline Norwegian Air Shuttle on Thursday, December 17, backed a rescue plan that includes debt conversion, a new share issue, and reduction of the fleet.

Hit hard by the COVID-19 pandemic’s impact on travel, having already been in financial trouble before, Norwegian recently applied for bankruptcy protection in both Ireland and Norway, in order to buy time to work out a solution with its creditors.

In early December, the company’s management presented a plan to stay afloat involving a large-scale conversion of debt into equity, a new rights issue to raise up to 4 billion Norwegian kroner ($466 million, 381 million euros), and the selling of an unspecified number of aircraft.

During an extraordinary general meeting on Thursday, shareholders overwhelmingly agreed to back the plan, granting management the mandate to begin negotiations with creditors.

The company, a pioneer in the low-cost long haul sector, has been in the red since 2017 and its debt amounted to 48.5 billion kroner at the end of September, in part the result of major expansion by the company.

Just 6 of the 140 aircraft it had in service at the start of the year are still flying, on Norwegian domestic routes, while only 600 employees among a formerly 10,000-strong payroll are still at work.

Shares in Norwegian were up over 10% after lunch on the Oslo Stock Exchange, though over the past year, they have lost 98% of their value. – Rappler.com

Add a comment

Sort by

There are no comments yet. Add your comment to start the conversation.

Summarize this article with AI

How does this make you feel?

Loading
Download the Rappler App!