Norwegian outlines plans to reduce fleet, convert debt to equity and raise EUR376m in stock issue
Norwegian Air Shuttle, in a stock exchange filing, announced (03-Dec-2020) a proposed plan to secure current and future travellers and potentially enable the company to exit its Irish Examinership process through measures to "right-size the company operations at a level of proven profitability". Details include:
- Measures involve reducing the fleet size and reconstructing the company's balance sheet to attract new investors and potentially support from Norway's Government;
- The company will perform a "reverse split" of shares in the ratio of 100:1 and reduce the nominal value of each share from NOK10 (EUR0.94) to NOK0.01 (EUR0.001);
- The company will undertake a debt to equity conversion, which will include aircraft financing or leasing liabilities, vendor and supplier liabilities, bond obligations and potentially arrangements that will require Norwegian to only pay for aircraft on a power by the hour basis until 2022;
- The final step in this process will be an equity issue of up to NOK4 billion (EUR376 million) in common stock and/or hybrid equity instruments to existing, new and other potential stakeholders;
- Should these actions be successful, shareholders and debtors will become "meaningful minority shareholders" of the company.
Norwegian will hold an extraordinary general meeting on 17-Dec-2020.