Norwegian Air seeks bankruptcy protection, to restructure

Low-cost carrier Norwegian Air Shuttle said Wednesday it is seeking restructuring and bankruptcy protection in Ireland, where its fleet is held, saying the decision was “in the interest of its stakeholders.”

“Norwegian will continue to operate its route network and both its bonds and shares will trade as normal on the Oslo Stock Exchange,” the carrier said.

Like other airlines, its fleet is now mostly grounded as the pandemic has caused a near-total halt to global travel.

It said that its top priorities remain “safeguarding as many jobs as possible, while rightsizing its asset base.” It did not provide further detail but said the process under Irish law may last for up to five months.

“Norwegian is therefore confident that it too will successfully emerge as a stronger and leaner airline ready to meet renewed airline travel demand in 2021 after the COVID pandemic subsides,” it said.

Earlier this month, the Oslo-based company said it was facing a “very uncertain” future after the Norwegian government turned down its request for additional financial support. The government said that the airline had been struggling financially even before the pandemic and that aid should be targeted first at healthy businesses.

After that, Norwegian announced it had to lay off another 1,600 staff and ground 15 of the 21 planes it had been flying with. The airline called it “a sad day for everyone in Norwegian.”

In May, the carrier got 3 billion kroner ($290 million) in loan guarantees from the government as part of its restructuring plan.

But the second call for aid was turned down on Nov. 9. The airline then said it “leaves Norwegian Air Shuttle ASA in a challenging situation.”

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