BAHR
Landed the solution when it mattered the most With almost every aircraft grounded, virtually no passengers and debts running to NOK 55 billion, the airline Norwegian was in dire straits in the spring of 2020. The solution involved – as the business daily Dagens Næringsliv phrased it – a mix of alchemy and Harry Potter. The airline was saved. – Norwegian had just emerged from a restructuring and the outlook was promising, when the pandemic dealt it a knockout blow. There was no time to lose. We were working against the clock, says Richard Sjøqvist, BAHR Partner and Head of the firm’s Finance market group. Like other airlines and travel industry companies, Norwegian took a hammering from the government restrictions introduced in response to covid-19. The airline approached the authorities already in February, with a warning that the situation might turn critical. Norwegian then had total debts of NOK 55 billion, of which NOK 33 billion were owed to aircraft leasing companies and NOK 21.9 billion were owed on aircraft owned by the airline itself.
On 19 March, the Government of Norway launched an emergency package totalling NOK 6 billion, of which NOK 3 billion was earmarked for Norwegian. However, this did not in itself resolve the airline’s predicament. Norwegian and the BAHR team needed to get the backing of all stakeholders for a plan to comply with the requirements under the borrowing programme. The airline got access to the first NOK 300 million of government funds through a combination of guarantees from DNB and Danske Bank. Norwegian thereafter needed to get interest and instalment relief, to enable a NOK 1.2 billion government guarantee to be furnished. The airline then had to strengthen its equity to gain access to the last NOK 1.5 billion.
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