Connect with us

Hi, what are you looking for?

Investing

Norwegian Air files for bankruptcy after State Aid is refused

Norwegian Air

Norwegian Air, once the brightest star in the low-cost transatlantic market offering £150 flights one way between London and New York, has filed for bankruptcy protection in Ireland.

Its application for examinership in the Dublin courts is a legal status similar to Chapter 11 in the United States, which enables a company to restructure itself but provides protection from creditors who could put it into insolvency. Norwegian is using the Irish protection as its 140 aircraft are legally owned by an entity wholly owned by Norwegian that is registered in Ireland.

“This is the next chapter for Norwegian,” a spokesman said. “It’s just the end hasn’t been written yet.”

Norwegian has gone through one big restructuring this year, when it successfully negotiated the swap of €2 billion of debt into equity with its creditors, although by this autumn it was carrying more than double that amount in debt.

The examinership could last months, during which Norwegian plans to sell much of its fleet and raise new capital.

The carrier almost fell to a takeover from International Consolidated Airlines Group, the British Airways owner, two years ago.

Operating only a handful of domestic services in Norway at present, it plans to re-emerge some time next year to start short-haul European services and to reactivate long-haul flights to the US from Gatwick, where it was once the third largest operatorage. At its peak, it employed 10,000 people and was carrying 37 million passengers a year, about three quarters the annual number flown by British Airways.

However, helter-skelter expansion under Bjorn Kjos, 74, its founder and former chief executive, left it heavily exposed to loss-making routes to South America and southeast Asia. It was on the brink of collapse even before the onset of the Covid-19 pandemic.

“Seeking protection to reorganise under Irish law is a decision that we have taken to secure the future of Norwegian for the benefit of our employees, customers and investors,” Jacob Schram, 58, Norwegian’s chief executive, said. “We will emerge from this process as a more financially secure and competitive airline, with a new financial structure, a right-sized fleet and improved customer offering.”

The Norwegian government has given up supporting the airline after declining this month to provide further finance and forcing it to ground aircraft and put 1,600 of its staff on furlough. It now has 600 operational employees.

Read more:
Norwegian Air files for bankruptcy after State Aid is refused

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

A Saudi flag flutters atop Saudi Arabia’s consulate in Istanbul, Turkey Oct. 20, 2018. — REUTERS/HUSEYIN ALDEMIR/FILE PHOTO RIYADH — Saudi Arabia’s crown prince...

Economy

IN FEB. 2019, Facebook, Inc. set up a test account in India to determine how its own algorithms affect what people see in one...

Economy

CHINA’S economy risks slowing faster than investors realize as President Xi Jinping’s push to cut its reliance on real estate and regulate sectors from...

Economy

Faced with a high level of competition in an era of streaming services, content providers must stay ahead by developing a strong user experience...

Economy

The Philippines remains under a “gray” list of countries under increased monitoring for money laundering and terrorism financing risks, despite some progress in implementing...

Investing

A Brewdog promotion which said customers could win “solid gold” beer cans was misleading, the advertising watchdog has found. The Scottish brewer offered shoppers...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Economy

Pfizer Inc on Wednesday raised its 2021 sales forecast for its COVID-19 vaccine by 29% to $33.5 billion, and said it believes people will...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.



Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!