Norwegian Air Shuttle expects to raise around $725 million (NOK6 billion) in fresh capital as a part of its restructuring plan which should help the airline to emerge from bankruptcy protection in Norway and Ireland by May 26, 2021. 

According to the Norwegian Air Shuttle announcement, released on May 3, 2021, the airline expects to have a cash holding of $725 million (NOK6 billion) by the end of May 2021. The carrier plans to offer new capital perpetual bonds that should bring the company around $226,162 (NOK1,875 million). 

Meanwhile, the airline aims to conduct a rights issue for another $47.6 million (NOK395 million) that should comprise the offering of more than 63 million new shares with a price of $0.76 (NOK6.26) per each providing an opportunity for the existing shareholders to gain 3 subscription rights for every 2 already held shares until May 21, 2021. 

The company also projects that after it carries out a private placement of new shares as it was initially determined in the restructuring proposal, the total proceeds of Norwegian Air Shuttle should not exceed the estimated $725 million.

If the capital raises plan succeeds, investors will own 75.7% of Norwegian Air Shuttle, while unsecured creditors will own 20.6% and existing shareholders will have the remaining 3.7% of the company.

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Norwegian Air to seek 6 billion crowns ($711 million) in capital, prior to its exit from bankruptcy protection in May 2021.
 

According to the document, in order to emerge from bankruptcy protection in Norway and Ireland, the airline reduced its debt by approximately $7.7 billion (NOK63-65 billion) and terminated aircraft orders amounting to $10.25 billion (NOK85 billion). Currently Norwegian considers emerging with a fleet consisting of 51 aircraft as it signed agreements for 4 owned and 44 leased planes with a further intention to acquire an additional 3 jets later.

The air carrier estimates that the total liabilities upon completion of the proposed restructuring should reach around $2.05 billion (NOK16-18 billion) of which up to $756 million (NOK6.3 billion) will be the aircraft-related debt. However, the company outlines that the calculations were made based on the assumption that “the maximum proceeds are raised in the capital raise.“