PPRuNe Forums - View Single Post - Norwegian burning cash!
View Single Post
Old 6th Oct 2017, 10:52
  #4 (permalink)  
Boeing 7E7
 
Join Date: May 2003
Location: UK
Posts: 427
Originally Posted by babemagnet View Post
How long will Norwegian last with all this cash being burned!?
2 BN in debt now!
Anybody?
This is how businesses grow. It's called investment and debt is the vehicle of this growth. Servicing debt, particularly at the moment due to the low interest rate environment that we have,is very cheap (even if rates increase from here) so while a 2BN euro debt may sound high to those without business expertise, it is almost 'free' money.

The banks that have lent Norwegian the capital will have studied Norwegian's business case very closely, to ensure that they receive return of both the capital and interest on it. It will not have been easy to secure these loans but the fact that they have, should demonstrate that Norwegian is pursuing a strategy that is likely to produce good results and has the backing of the financial lenders.
Boeing 7E7 is offline