Norwegian: Establishment of Asset Management Company
30-Aug-2013 Norwegian has decided to establish a fully owned asset management company. The asset management company will be incorporated under the laws of Ireland and will have USD as its functional currency. Ireland is the largest aviation finance cluster in Europe which makes the country a natural location given Norwegian's global expansion and large aircraft orders.
The first aircraft to be placed under the control of the asset management company is the Boeing 737-800 due for delivery in September 2013. The asset management company will operate as lessor of the aircraft. The incorporation of the new subsidiary will also limit currency exposure to the balance sheet. The currency exposure is primarily driven by a mismatch between USD denominated loans and aircraft balance sheet values denominated in NOK, managed today by extensive hedge arrangements.