Norwegian Air Seals Chinese Bank Deal to Finance Expansion

Norwegian Air Shuttle has sealed a long-awaited joint venture with one of China’s biggest banks in a deal designed to bolster a balance sheet strained by the low-cost carrier’s breathless pace of expansion, the Financial Times reported. The joint venture, 70 per cent owned by a subsidiary of state-controlled China Construction Bank, will be responsible for financing 27 Airbus A320neo aircraft that Norwegian expects to be delivered in 2020-23. The Nordic airline, Europe’s third-largest low-cost carrier, said the deal with China Leasing International Corporation would slash its capital expenditure by $1.5bn. Shares in Norwegian, which have tumbled this year, closed up 25 per cent in Thursday. The fast-growing group has become a disruptive force within the European airline industry, leading the charge in lowering the cost of long-haul flights and forcing rivals to respond with their own budget services. Read more