As part of its restructuring proposal, Norwegian has issued terms for its contemplated capital raise of up to NOK 6,000 million. The deal comprises: an offering of new capital perpetual bonds raising gross proceeds of up to NOK 1,875 million; a rights issue raising gross proceeds of up to NOK 395 million (the company will issue 63,076,638 new shares at a subscription price of NOK 6.26 per share); and a private placement of up to 958,466,453 new shares at a subscription price of NOK 6.26 per share and will raise maximum gross proceeds of less than NOK 6,000 million.
On 28 April 2021 the United States Bankruptcy Court of the Southern District of New York granted the recognition motion of Norwegian Air Shuttle ASA and Arctic Aviation Assets DAC pursuant to chapter 15 of the US Bankruptcy Code.
Subject to completion of the Restructuring Proposal and based on the voluntary restructuring in May 2020, Norwegian confirmed that since the end of 2019 it has reduced total debt by approximately NOK 63 - 65 billion and terminated aircraft orders of approximately NOK 85 billion in aggregated value. Norwegian has also negotiated and signed agreements for four owned and 44 leased aircraft, with a further three aircraft under documentation to be retained and leased. All 51 aircraft will be operated based on “Power by the Hour” agreements through Q1 2022 which Norwegian states will significantly increase its flexibility and limit lease payments in the event of a prolonged period with challenging markets due to the COVID-19 pandemic.
Based on the success of its capital raising, Norwegian’s total liabilities upon completion of the Restructuring Proposal will be approximately NOK 16 - 18 billion, of which NOK 5.8 – 6.3 billion is aircraft related debt. The company’s cash balance (including restricted cash) upon completion of the Restructuring Proposal is estimated to be approximately NOK 7 billion.
For the New Capital Perpetual Bonds Offering, the company has now received subscriptions from certain Eligible New Capital Perpetual Bonds Creditors for an amount exceeding NOK 1,875 million.
After completion of the Capital Raise, and assuming that it is fully subscribed at the maximum transaction size of NOK 6,000 million and that NOK 1,875 million is raised in the New Capital Perpetual Bonds Offering, investors in the Capital Raise will own approximately 75.7%, unsecured creditors will own approximately 20.6% through conversion of Dividend Claims, and existing shareholders will own approximately 3.7%.
DNB Markets, a part of DNB Bank, is acting as Sole Global Coordinator and Joint Bookrunner for the Capital Raise and ABG Sundal Collier is acting as Joint Bookrunner. Seabury Securities serves as financial advisor for the Capital Raise. Advokatfirmaet BAHR is acting as legal counsel to the Company. Advokatfirmaet Thommessen is acting as legal counsel to the managers.