Seeking Bankruptcy Protection in Ireland to Save Norwegian – E24

The case is being updated …

Norwegian announced Wednesday afternoon that the company is now seeking bankruptcy protection for subsidiaries Norwegian Air International and Arctic Aviation Assets in Ireland, under what is called an “examinership.”

This is no different from what is known as Chapter 11 in the United States.

“Norwegian Air Shuttle will also seek and receive protection from the Irish examination process as a related party,” the airline writes, meaning that the entire group of aircraft will be protected from bankruptcy in the process.

Norwegian Air International was Norwegian’s first foreign subsidiary and was the cornerstone of the company’s expansion internationally, especially when it came to long-haul routes. The company is, in fact, a full-fledged airline registered in Ireland.

Norwegian also has subsidiaries with their own flight licenses in Norway, Sweden and the UK.

Arctic Aviation Assets is Norwegian’s subsidiary in Ireland that physically owns Norwegian’s own aircraft.

“Norwegian has chosen the Irish process as the company’s aircraft is owned by Ireland,” Norwegian writes.

Bankruptcy protection will mean that the court appoints an “examiner” who manages the process and allows the company to restructure debt, raise fresh capital and secure a binding debt agreement.

P.S! Norwegian has announced a press conference at 6pm. E24 is following the case!

Will survive the crown

According to the company, Norwegian’s decision to take this step “as a result of the Norwegian government’s refusal to support the airline in the ongoing COVID-19 pandemic.”

– We have made the decision to apply for protection to reorganize under Irish law to secure Norwegian’s future in a way that benefits our employees, customers and investors, says CEO Jacob Schram in Norwegian in a press release.

– Our goal is to find solutions in collaboration with our stakeholders that will allow us to overcome this as a financially stronger and stronger airline, says Norwegian CEO Jacob Schram.

Norwegian, along with the rest of the aviation industry, has been hit hard by the corona pandemic. The company avoided bankruptcy this spring when it managed to secure a comprehensive financing package that secured the company’s access to NOK 3 billion in government-guaranteed loans.

During the summer and fall, the company has worked on a new rescue package. On November 9, the government announced that it would not stand up with special support for Norwegian, something that CEO Jacob Schram described as a “punch to the stomach.”

The market waited excited

It was in an announcement on the stock exchange shortly after 1:30 on Wednesday afternoon that it emerged that the stock in Norwegian was halted pending an announcement from the company.

The Norwegian share was down 0.32 percent at a price of NOK 0.47 before the close. At the same time, SAS stock received a boost following news of a stock market break with the competitor. SAS stock rose 6.4 percent on Wednesday afternoon.

The Oslo Stock Exchange may introduce a stock market break if it has received a message from the company in question, if there are “irregular price movements”, if there is a suspicion that there is an uneven flow of information to the market or “in response to other events, “according to Børsen.

For example, a company may request the Stock Exchange to stop trading before publishing a notice that will be of great importance to the company.

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