Norwegian Air Drops 60% as Reality Sinks In for Shareholders

Norwegian Air Shuttle ASA dropped as much as 60% after completing a recapitalization that hands control of the company to aircraft lessors and bondholders, Bloomberg News reported. Investors had in recent days stubbornly traded Norwegian’s shares far above the price of a discounted equity issue that came on top of an $830 million debt conversion. On Wednesday, the stock collapsed after the company confirmed it had finally clinched a state-guaranteed loan that will keep it afloat in the next few months and increased its share capital. The debt conversion has marginalized current shareholders, with leasing companies Aercap Holdings NV and BOC Aviation Ltd. flagging stakes of 16% and 13%, respectively, putting them among the low-cost carrier’s biggest owners. BOC is controlled by the Chinese government through Bank of China Ltd. Norwegian Air traded 27% lower at 2.77 kroner as of 2:45 p.m. in Oslo. Read more