MIAMI – Norwegian Air (DY) obtained an Oslo Court approval for its reconstruction plan, a step forward to exiting bankruptcy in the coming months.
Todays press release from the carrier indicates that, with the approval already secured by an Irish Court decision, the Oslo Court decision marks a milestone in the actions taken to bring back the Group into financial safe grounds and allows to prepare the process for raising new capitals.
Reconstruction Plan Approved
The carrier gained the confidence of its creditors, after a reconciliation process that ended on April 9, and obtained their approval of the plan.
Jacob Schram, DY CEO, commented on the decision by stating “We are very pleased with this important positive decision by the court. Once we have passed these two biggest legal milestones we can look forward to continuing the work of raising new equity.”
Hee also expressed his satisfaction and said to be proud of the achievements reached by DY during this period and praised his colleagues “that have shown such unwavering commitment and determination for us to succeed.”
Heavy Losses in 2020, Aircraft Order Canceled
For the fiscal year 2020, DY presented a heavy loss of US$ 1.91bl stemming from the Covid-19 global crisis. The carrier lost 92% of its passengers (-540000), Available Seats per Kilometer (ASK) decreased by 96% and Revenue Passenger per Kilometer (RPK) dropped 97%. The load factor went down 32,5% compared to 2019. Bankruptcy was also declared for the French and Italian branches of DY.
The carrier also canceled all its orders with Boeing, the matter is still pending a court decision, and charged Orix Aviation to find a new lessor or owner for 12 of 18 Boeing 737 MAX already delivered to the Airline. The same action has been taken with Airbus but the cancellation of pending orders entailed the write-off advance payments already made by DY.
The reconstruction target is set to a reduction of debt to US$2.31bn and secure capital for approximately US$500m. The Court ruling, both in Ireland and Norway, shall become effective once the expected equity has become available with a target set for the month of May to raise capital.
The fleet also stands to be reduced and composed solely of 53 Boeing 737-800NG out of which 50 in active duty and three as stand-by.
Featured image: Norwegian EI-FJW Boeing 737-8JP – Photo : Alberto Cucini/Airways