Struggling Norwegian Air launches shares issue, bond

By Gwladys Fouche and Terje Solsvik OSLO (Reuters) - Norwegian Air is planning a share issue and a $175 million (£136 million) bond, raising enough cash to meet the struggling budget airline's needs through 2020 and beyond, it said on Tuesday. The share issue will be its third in less than two years. With mounting debts and suffering from the grounding of its 18 Boeing 737 MAX aircraft, Norwegian has this year replaced breakneck expansion with cost cutting in a bid to regain profitability

Reuters November 06, 2019 00:06:44 IST
Struggling Norwegian Air launches shares issue, bond

Struggling Norwegian Air launches shares issue bond

By Gwladys Fouche and Terje Solsvik

OSLO (Reuters) - Norwegian Air is planning a share issue and a $175 million (£136 million) bond, raising enough cash to meet the struggling budget airline's needs through 2020 and beyond, it said on Tuesday.

The share issue will be its third in less than two years.

With mounting debts and suffering from the grounding of its 18 Boeing 737 MAX aircraft, Norwegian has this year replaced breakneck expansion with cost cutting in a bid to regain profitability.

"After the completion of the transactions, Norwegian is fully funded through 2020 and beyond based on the current business plan," Europe's third-largest budget airline by passenger numbers said in a statement.

It said it was considering a private placement of up to 27.25 million new shares and a bond issue of up to $175 million.

The deals together could raise close to 2.9 billion Norwegian crowns (£245 million) if the shares are sold at current market prices, a Reuters calculation showed, although the company might have to sell at a discount.

"The proceeds ... will secure required financing of working capital during the winter season and create headroom to financial covenants while completing the strategic transformation of the company," it said.

The airline also reported October traffic figures on Tuesday, before the scheduled release on Wednesday.

Passenger traffic declined in October from a year ago, its monthly report showed, the first such fall on record as the carrier cut loss-making routes from its network.

Overall traffic, a measure of distance flown and the number of people carried (RPK), fell 3% year on year in October, the company said. Analysts in a Reuters poll on average had expected a fall of 12.1%.

(Reporting by Terje Solsvik and Gwladys Fouche; Editing by Edmund Blair)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Turkey's daily COVID-19 deaths hit a record high of 141 - ministry
World

Turkey's daily COVID-19 deaths hit a record high of 141 - ministry

ANKARA (Reuters) - Turkey's daily death toll from the coronavirus hit a record high of 141 on Friday, according to data from the Health Ministry, as the country braced for nationwide measures amid a surge in cases in recent weeks. The data showed 5,103 new COVID-19 patients were recorded in the country, while the overall death toll rose to 12,084. Since July, Ankara has only reported symptomatic COVID-19 patients, a move critics say hides the true scale of the outbreak.

Gunman releases all hostages in Georgian capital Tbilisi - police
World

Gunman releases all hostages in Georgian capital Tbilisi - police

TBILISI (Reuters) - A gunman has released unharmed all nine hostages he had taken at a microfinance organisation in the Georgian capital Tbilisi on Friday, police said. According to preliminary information, the gunman was not demanding a ransom but had some social demands, including lower prices for medicines

With applause and flowers, thousands attend funeral of Belarusian protester
World

With applause and flowers, thousands attend funeral of Belarusian protester

By Matthias Williams KYIV (Reuters) - Thousands of people silently raised their arms in the air, held flowers aloft and broke into chants outside a church in Minsk on Friday at the funeral of a Belarusian protester. The death of 31-year-old Roman Bondarenko has become a flashpoint in months-long mass protests against President Alexander Lukashenko. Witnesses said Bondarenko was detained after a scuffle with people in plain clothes who came to a playground to remove red-and-white ribbons representing the protest movement