Loss-making Norwegian Air has appointed Jacob Schram as chief executive to take charge of the budget carrier’s restructuring as it struggles with a low-cost, long-haul model in an overcrowded industry, Reuters reported. Schram, who does not have a background in aviation, joins Norwegian from management consulting company McKinsey and was previously a top executive in the petrol retail industry, Norwegian’s board said on Wednesday.
Geir Karlsen has been busy. Over the past four months, the chief executive of Norwegian Air Shuttle has sold off a large chunk of the airline’s assets at a remarkable pace as he attempts to secure the future of the world’s fifth-biggest low-cost carrier, the Financial Times reported. But the 54-year old acting chief executive, who took the top job in July and also wears the airline’s chief financial officer hat, remains sombre. “We’re not happy”, he said, when asked if he is pleased with the changes he has made, but added that the airline is “on the right track”.
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.
Poland’s government has proposed the country’s first balanced central government budget in three decades, as the ruling Law and Justice party tries to boost its reputation for economic management ahead of October’s parliamentary election, the Financial Times reported. Since coming to power in 2015, the socially conservative Law and Justice has sharply boosted welfare spending, with handouts to pensioners and families playing a key role in cementing support for the party among older and less well-off Poles.
Norway’s central bank has cast doubt on whether it will raise interest rates again this year as growing economic uncertainty around the world fuels a global shift towards looser monetary policy, the Financial Times reported. The bank was dubbed “the sole hawk in town” after raising rates at the end of June, its third increase in the past year.
Harland and Wolff, the Belfast shipyard that built the Titanic, was put into administration on Monday after its bankrupt Norwegian owner failed to find a buyer and calls for its nationalization were rebuffed, Reuters reported. The shipyard, whose towering yellow cranes dominate the Northern Irish city’s skyline, has been occupied by workers fearful for their jobs since last week. They said on Monday they would block administrators from entering the site. “BDO have been appointed as administrators and the company will file for insolvency tomorrow,” a Harland and Wolff spokesman said.
Norwegian oil and gas rig operator Dolphin Drilling filed for bankruptcy on Wednesday, leading creditors to seize its key assets in a restructuring that will see the company maintain operations, Reuters reported. Formerly known as Fred. Olsen Energy, Dolphin Drilling ASA had debt of just over $1 billion at the end of 2018 and a net loss for the year of almost $300 million, its annual report shows.
Seadrill’s core earnings for the fourth quarter exceeded the company’s own guidance, boosted by lower costs and one-off items, while the market outlook for drilling rigs was improving, the Oslo and New York-listed firm said on Tuesday. The company, controlled by Norwegian-born billionaire John Fredriksen, reported $73 million in quarterly adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), more than double the $35 million forecast it made in November, Reuters reported.
Scandinavians are taking a hard look at their institutions as allegations of systematic money laundering rock the entire region, Bloomberg News reported. With Swedbank AB becoming the latest lender to get dragged into a dirty money scandal that’s already engulfed Danske Bank A/S, those at the top of Sweden’s financial establishment are speaking out. Hans Lindblad, the director general of the Swedish National Debt Office, says the financial industry now risks losing the trust of the people. He says the consequences of that would be dire for the whole economy.
Norwegian Air’s shareholders overwhelmingly endorsed on Tuesday the lossmaking airline’s plan for a deeply discounted cash call to help bolster its finances, Chairman Bjoern Kise said. Norwegian Air said on Jan. 29 it would raise 3 billion Norwegian crowns ($348 million) in a rights issue, just days after British Airways owner IAG ruled out a bid for the budget carrier, Reuters reported.