Norwegian Air to end transatlantic flights, seeks state help

It hopes to cut its debt to around 20 billion crowns and raise 4-5 billion through a mix of new shares and hybrid capital. "The company has recently reinitiated a dialogue with the Norwegian government about possible state participation based on the current business plan," it said in a statement.

Norwegian Air, which challenged British Airways and other long-established rivals by launching transatlantic flights, said on Thursday it will end those services and seek government help.

The budget airline, founded in 1993, has been forced to ground all but six of its 138 aircraft due to the pandemic. "Norwegian will henceforth focus on its core Nordics business, operating a European short-haul network with narrow body aircraft," the company said.

It aims to cut its fleet to about 50 aircraft before expanding to around 70 in 2022, it said. The plan is subject to approval by an Irish bankruptcy court.

Norwegian risks running out of cash by the end of March if it fails to restructure debt and liabilities of 66.8 billion Norwegian crowns ($7.89 billion), including 48.5 billion in interest-bearing debt, it warned late last year. It hopes to cut its debt to around 20 billion crowns and raise 4-5 billion through a mix of new shares and hybrid capital.

"The company has recently reinitiated a dialogue with the Norwegian government about possible state participation based on the current business plan," it said in a statement. The plan could return Norwegian to profit before interest, tax, depreciation and amortisation (EBITDA) later this year "based on conservative assumptions both in relation to the length of the COVID-19 pandemic and relating to revenue, costs and load factors", it said.