Estonian state-owned airline Nordica is to cease operations and file for bankruptcy after a potential investor backed out of a deal earlier this week.
Nordic Aviation Group made the decision to end Nordic Aviation Group AS and Regional Jet OÜ (Xfly's) operations, after negotiations with investor Lars Thuesen fell through on November 18, 2024.
Remco Althui, CEO of Nordic Aviation Group said: “Nordic Aviation Group and Xfly have gone through a challenging path over the past 15 months since the airline began its turnaround process in August 2023. This journey has been marked by immense efforts from the entire team to bring the airline to a new and sustainable footing.”
Althuis noted that the company takes “great pride” in results achieved during this process, which have placed the company on solid financial ground since spring 2024. "We have succeeded in serving our clients to the highest industry standards, as evidenced by above-average punctuality and service levels. This has been recognised by our valued cooperation partners, who have commended our team for the excellent service provided," he added.
The shareholder of Nordic Aviation Group and its subsidiary Xfly, the Government of Estonia, initiated the process of privatising the company in late 2023. The final discussions on privatisation have been ongoing during the past week.
"However, on Monday, the potential investor informed us about his intention not to proceed with the privatisation, as the associated risks were too high," explained the chairwoman of the supervisory board of Nordic Aviation Group, Kadri Land. “Consequently, the management board informed the supervisory board about its intent to cease the operations of Nordic Aviation Group and Xfly and start the necessary proceedings to file for bankruptcy.”
According to Eesti Rahvusringhääling – Estonia’s public broadcaster – the firm had 579 employees in October, of those 286 are employed in Estonia.
The company has informed all its employees and cooperation partners, including the lessors of the airplanes about the intention to file for bankruptcy.