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Norwegian wins financial space as bondholders agree to payment delay

Norwegian wins financial space as bondholders agree to payment delay

Bondholders at low-cost carrier Norwegian have accepted a plea to postpone payment of up to US$380 million by up to two years.

Having offered lucrative take-off and landing slots at Gatwick Airport in London as security, the deal will provide the airline with some financial relief.

Norwegian will also pay a premium on the bonds.

The airline has struggled to make money in recent years and recently refocused its efforts from expansion to profitability.

“We are pleased with the bondholders’ decision to amend the bonds as it will give us added financial headroom going forward,” acting chief executive, Geir Karlsen, said in a statement.


Norwegian remains on track to cut costs by US$223 million this year, he added.

To alter the terms, two-thirds of bondholders at a meeting in Oslo had to back the proposal.

In the end, 89.8 per cent of owners of the NAS07 bond gave their consent, while support for the NAS08 bond stood at 99.64 per cent.

The third-largest low-cost carrier by passenger numbers in Europe, after Ryanair and easyJet, Norwegian has made major inroads in the market for transatlantic travel, but haemorrhaged cash to pay for the rapid expansion.

The airline has been hit by the grounding of the Boeing 737 Max in recent months, while rising fuel prices have also taken a toll.