The Norwegian government has handed Norwegian Air an eleventh hour lifeline in its efforts to avoid bankruptcy.
On Thursday, January 21, the Oslo government agreed to provide a hybrid loan to the low-cost carrier on the proviso that the airline raises at least NK4.5 billion (€436 million) and completes the restructuring that should halve its debts.
The Oslo government’s decision is a reversal from autumn 2020, when it refused a bailout of the beleaguered airline, but since then Norwegian has shed its long-haul services.
Chief executive Jacob Schram said: “On behalf of everyone at Norwegian, I would like to sincerely thank the government for their support.
“Norwegian has been faced with a very challenging and demanding situation due to the pandemic, and the government’s support significantly increases our chances of raising new capital and getting us through the reconstruction process we are currently in.
“We still have a lot of work ahead of us, but a participation from the government underscores that we are heading in the right direction.”
The airline entered into an Irish examinership process late last year in an effort to stave off bankruptcy.