Norwegian Air Shuttle launches reconstruction processes to exit from Irish examinership

OSLO: Following the Irish High Court’s decision on Friday 5 March 2021 in respect of the repudiation of certain contracts, Mr Kieran Wallace of KPMG Ireland as Examiner of Norwegian Air Shuttle and a number of Irish subsidiaries of the Group proposed schemes of arrangement for the financial restructuring the Company and the Examinership Companies, which in the case of the Company will be implemented through the Norwegian reconstruction processes.

The Restructuring Proposal provides, among other matters, for each creditor with an unsecured claim to receive a dividend equal to 5.0% of such creditor’s unsecured claim (excluding any amount the creditor may recover through participation in the proposed capital raise) comprising (i) a pro rata cash payment from a NOK 500 million “pool” to be distributed among unsecured creditors and customer creditors (ii) a convertible debt claim with 7 year maturity and NIBOR +1% interest (“Dividend Claims”).

The Dividend Claims will on certain terms and conditions be convertible in aggregated into shares representing up to 25.4% of the Company’s share capital following the Restructuring and the proposed capital raise.

The Restructuring Proposal is conditional on certain matters including the approval of requisite classes of creditors of the Examinership Companies, the confirmation by the Irish High Court and the Norwegian Court (in the case of the reconstruction) and ultimately the closing of the proposed rights offering, private placement and offering of perpetual hybrid instrument (the “New Capital Perpetual Bonds”) (the “Capital Raise”).

New investors in the Capital Raise, by investing in equity and/or the New Capital Perpetual Bonds, will receive approximately 70% of the post-Restructuring share capital with the shares held by existing shareholders diluted to approximately 4.6%. This equity allocation (including the allocation of the shares on the conversion of the Dividend Claims) assumes, for illustrative purposes, an overall Capital Raise of NOK 4,500,000,000, comprised of up to NOK 3,000,000,000 in shares (including rights offering of NOK 400,000,000) and up to NOK 1,875,000,000 in New Capital Perpetual Bonds and will be subject to change in the event that the Capital Raise exceeds NOK 4,500,0000.

Current creditors of Norwegian have already expressed an interest to participate in the Capital Raise with an amount of at least NOK 1,800,000,000.

Further details regarding the Restructuring Proposal and its terms are set out in the proposals for a scheme of arrangement (the “Proposals”) and accompanying explanatory memorandum issued by the Examiner.

The Examiner is today convening meetings of the relevant classes of members and creditors of the Company and the Examinership Companies to take place over the course of 18 – 20 March 2021 and will as soon as possible thereafter seek the confirmation of the Proposals by the Irish High Court.

In the event the Restructuring is approved by the required authorities the Company plans to move forward with the Capital Raise commencing in April and target closing in May 2021.

www.norwegian.com

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