Budget carrier Norwegian Air showed poor judgement when it paid bonuses to top management just weeks after emerging from government-backed bankruptcy proceedings, Norway’s industry minister said on Tuesday, Reuters reported. Having shed thousands of jobs during the pandemic and forced creditors to swap billions of dollars in debt for stock in the slimmed-down airline, Norwegian completed a court-ordered financial restructuring in late May.
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Norwegian Air fired Chief Executive Jacob Schram who led the budget carrier through restructuring and said that it was promoting Chief Financial Officer Geir Karlsen to the top job with immediate effect, Reuters reported. The board voted on June 20 to end Schram's 18-month tenure but the airline said he would support the carrier on a full-time basis during his notice period up to March 31. "The board's decision to fire me came as a big surprise," Schram told Reuters. His replacement, Karlsen, has been chief financial officer since 2018.
Britain has clinched post-Brexit trade agreements with Norway, Iceland and Liechtenstein as it seeks to forge new global trading relationships after leaving the European Union, Reuters reported. The three nations, which are part of the European Economic Area allowing them access to the single market, have relied on temporary trade arrangements with Britain since the end of a Brexit transition period on Dec. 31.
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Norwegian Air emerged from six months of bankruptcy protection on Wednesday with a smaller fleet and its debt almost wiped out but also facing stronger competition and lingering uncertainty wrought by the pandemic, Reuters reported. The airline said on Friday that it had raised 6 billion Norwegian crowns ($721 million) in fresh capital, as planned, more than enough to meet the minimum requirement set by bankruptcy courts in Dublin and Oslo.
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Norwegian Air is set to exit its restructuring process next week after raising the 6 billion Norwegian crowns ($714 million) it targeted through the sale of perpetual bonds, new shares and a rights issue, Reuters reported. Financed largely by debt, Norwegian Air grew rapidly, serving routes across Europe and flying to North and South America, Southeast Asia and the Middle East before the COVID-19 pandemic plunged the budget airline into crisis.
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While Norwegian Air is focusing on a massive restructuring process, attempts to raise new capital, and emerge from bankruptcy in Ireland and Norway, the airline’s employees in France, who were left jobless and uncompensated, are taking legal action to push the air carrier’s subsidiary Norwegian Air Resources France into liquidation, AeroTime reported.
Budget airline Norwegian Air expects demand for European short-haul travel to return to pre-pandemic levels in 2023 or 2024, it said as it presented a first-quarter pretax loss of 1.19 billion crowns ($145 million) and Reuters reported. The carrier this month said it aims to raise 6 billion crowns in fresh capital, up from the 4.5 billion originally planned, as part of a scheme to emerge from court-ordered bankruptcy protection next month.
The Irish High Court has approved a survival plan for the troubled airline Norwegian Air and related companies, the Irish Times reported. In a written decision Mr. Justice Michael Quinn said he was satisfied to approve the scheme put together by the airline’s examiner Kieran Wallace of KPMG. The airline’s Oslo-based parent company and several of its Irish-registered subsidiaries had sought the protection of the Irish courts due to factors including the devastating impact that the Covid-19 pandemic has had on the airline industry and international travel.
Norwegian Air now aims to raise up to 6 billion crowns ($711 million) in fresh capital, up from a planned 4.5 billion, to bolster its resources before emerging from bankruptcy protection next month as the pandemic continues to curb travel, Reuters reported. Financed largely by debt, Norwegian Air grew rapidly, serving routes across Europe and flying to North and South America, Southeast Asia and the Middle East before the COVID-19 pandemic plunged the airline into crisis.
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Norwegian Air has won approval from creditors in Norway to restructure its debt and an Oslo court has approved the plan, the airline said on Monday, clearing the way for it to raise new capital and emerge from bankruptcy next month, Reuters reported. Financed largely by debt, Norwegian Air grew rapidly, serving routes across Europe and flying to North and South America, Southeast Asia and the Middle East before the COVID-19 pandemic plunged the airline into crisis.
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