Irish Court To Assess Norwegian Air Business Plan On January 22
The official overseeing Norwegian Air's protection from its creditors in Ireland will present a report to the Irish High Court on January 22, having received a business plan from the cash-strapped airline.
The airline obtained creditor protection earlier this month from courts in Ireland and Norway, giving it some breathing space to restructure its massive debts. Its main aircraft-owning subsidiaries are Irish and its parent company, Norwegian Air ASA, is registered in Norway.
Norwegian's shareholders endorsed a financial rescue plan last week and it now faces difficult negotiations with creditors as it tries to reduce its debt and liabilities of 66.8 billion Norwegian crowns ($7.8 billion). It must also find investors and lenders willing to put up fresh cash.
Paul Sreenan, a lawyer for the Irish examiner appointed to Norwegian, told a court update on proceedings that the plan presented to shareholders represents airline management's "current thinking" and that a detailed business plan will be presented to the examiner imminently.
The company, which helped transform transatlantic travel by expanding the European budget airline business model to longer-haul destinations, is under examinership in Ireland, which is a legal process akin to Chapter 11 bankruptcy in the United States that can last up to 100 days.
The examiner reconfirmed his view that Norwegian has a reasonable prospect of survival as a going concern, Sreenan added. In Ireland, an examiner seeks to put a legally binding scheme in place to settle the debts within 100 days.
Norwegian chief financial officer Geir Karlsen told Reuters that it plans to give assurances in the courts that it can get access to sufficient capital by the end of February, but that the process could be drawn out further.
Justice Michael Quinn, presiding over the update, said that while it is a complex case that may not reach an outcome in time, the parties should not unduly assume that it will be extended beyond the 100 days.
He also encouraged the examiner to share the company's plans with lessors whose aircraft may be returned as a result as early as possible.
"Somewhat Sparse" Information
A lawyer representing some creditor lessors including Aercap and BOC Aviation complained that the information put before the court so far is "somewhat sparse".