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That's old news I'm sorry to say, announced some months ago and probably just picked up by this journalist. They applied for the traffic routings as reported a few posts back before the crunch came, perhaps they anticipate generating enough cash from the 6 internal routes and the Boeing compensation to start these routes again.
https://www.routesonline.com/news/38...as-of-23oct20/ |
AreCap has sold 156 million Norwegian shares and now own less than 10% (9%) of the company.
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Not surprising as Norwegian have just converted another $2m in debt to shares, the dilution is so much now that the forecast is them to be worth zero by next year, so selling while you can at least get something back is the best option and Aercap posted a loss of 850M in the last QTR with depleted cash reserves. Its a domino effect
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But it reaches a precipice when the secured stake/debt holders can extract more value from the liquidation assets than they will ever get from D4E swaps, or than risked returns from letting the company continuing to trade. As equity value is almost zero, I'm surprised that point hasn't already happened.
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Trading suspended on the Oslo Stock Exchange. At the stop of trading, a share in Norwegian cost NOK0.47.
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Would anyone buy a ticket with Norwegian at the moment?
Thats the crux of the problem, without forward bookings the relaunching of Longhaul out of LGW looks doubtful, indeed any flying out with Norway itself appears problematic. i hope I’m wrong but it’s not looking great. |
LGW long haul start up in March was the original plan.
It then came forward to December, now back to March. I would not book, but that is just me. Just cannot see how they can restart the equivalent of an entire airline again (30 odd 787s), with nobody current on type, and the aircraft stored. It will be such a huge cost to bring back the fleet. |
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https://media.uk.norwegian.com/press...ot-dot-3052095
“Our intent is clear. We will emerge from this process as a more financially secure and competitive airline, with a new financial structure, a rightsized fleet and improved customer offering,” said Schram. |
Norwegian is seeking examinership / reorganisation in Ireland, where the company that owns their plane assets is registered.
Examinership protection requested to include NAS (Norwegian Air Shuttle (the Norway registered mothership) as a related part. According to stock exchange release: https://newsweb.oslobors.no/message/518391 |
For those in the dark:
Examinership is Irelands corporate rescue process which gives an insolvent Company (or group of Companies) protection from its creditors for a period of up to 100 days. The protection afforded under examinership legislation is to facilitate a Company (through a Court appointed Examiner) secure investment and put a legally binding scheme of arrangement in place for the settlement of debts with its creditors. Once a Company has been placed in examinership by the Court, this prevents any enforcement through either the appointment of a liquidator or a non- statutory receiver. A Company can utilise the examinership legislation to overturn the appointment of a Receiver but there is a very narrow window of time to do so. When a Company successfully exits the examinership process, the Company continues trading with the business and assets intact, jobs saved but without the majority (or in some cases any) of the liabilities accumulated prior to entering the examinership. The opportunity which examinership affords for Companies to restructure is invaluable. Getting early advice prior to and guidance throughout the process is critical to a successful outcome. Examinership Process Obtaining a practical understanding and clear direction on each of the three distinct stages of the process; entry, during and exit is paramount to a successful outcome; Entry • Company must be insolvent • Company must be suitable for the process meaning that it should have a reasonably prospect of survival, sufficient cash flow for the 100 day protection period and ideally have the support of stakeholders To allow a Company successfully exit examinership, the investment pledged must be received by the Company. Sufficient investment monies will be required to facilitate the payment of the dividends outlined in the scheme of arrangement, any immediate working capital required and the examinership costs. |
It is a brilliant way to do business. Grow like there is no tomorrow with an unprofitable business model, lose a fortune, accumulate as much debt as you can, restructure your debt once by asking your creditors to become shareholder, lose 99% of your company value in a year then what, 6 months after ask to restructure the debt again. You could not make this stuff up.
And most of this happened in a time where most of your competitors were making billions of profits. |
Lars-Daniel Westby, an analyst at SpareBank 1 Markets in Norway, who last week told the Financial Times Norwegian was likely to file for bankruptcy in Ireland or the US, has said it could split into a profitable short-haul European operation and a lossmaking long-haul business. |
I am no businessman but why would you bother with a loss making long haul business? Why not just sit on the profitable shorthaul operation?
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They won't! the loss making LH will be culled and the SH will be offered to investors. Of course, the LH leasing companies that are also shareholders may be offered pro rata shares in any revamped SH venture just to stop them voting against the proposals put to creditors and the plug being pulled. This process will only work if the majority of creditors accept the plans and the court are sure that the company can survive.. any doubt is no doubt as they say in the sim!
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First deadline December 6.
By this date they (Ireland) must decide if keeping the company alive is a better option than selling off whatever values it has. The way this company is set up does not make this easy. Only the Irish parts are in «Chapter 11», the Norwegian part of Norwegian is protected as an «associated» company. If they manage to pull this off, they have 150 days to get the company on it’s feet. That takes money. The Irish/Chinese owners don’t want to inject any money, something the NO government is well aware of. On top of that, the government is not very happy with the way Norwegian is set up with various sub companies in other countries. |
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It's incredible how some "know" who wants to put money , who doesn't , if the Irish if the Chinese if Santa, what's going to happen and by what order. Basically know more than the investors themselfs 🤣
This thread is going for years...already bankrupted and closed shop at least 5 times and somehow it's still up and running... |
737Driv3r;
Santa is not a shareholder, but China (via 6 or 7 sub-companies) and AerCap (Ireland) + several other Irish companies are. Between them they own a big chunk of Norwegian. Please tell us how much money they have injected into the company? The answer is 0. They don’t even want to own the company, but was forced to by the debt for shares stunt Norwegian pulled. |
The special thing now is that many of the largest owners are both creditors and shareholders. They are guaranteed to vote yes to restructuring if they get paid well enough for their debt in the form of shares in new Norwegian, and sell the old almost worthless diluted shares.
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