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Norwegian Proposes Debt Restructuring That Will Wipe Out Owners

  • Shareholders would be left with 5.2% before equity raise
  • Norwegian doesn’t expect normal operations until 2022
An employee carries out checks on a Boeing Co. 787 Dreamliner passenger aircraft, operated by Norwegian Air Shuttle ASA, at London Gatwick Airport in Crawley, U.K.
An employee carries out checks on a Boeing Co. 787 Dreamliner passenger aircraft, operated by Norwegian Air Shuttle ASA, at London Gatwick Airport in Crawley, U.K.Photographer: Simon Dawson/Bloomberg
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Norwegian Air Shuttle ASA, the low-cost carrier fighting to qualify for a bailout, presented a plan to relieve part of its heavy debt burden that would largely wipe out existing shareholders and warned most flights would stay grounded until next year.

The airline is racing against the clock to meet terms set by Norway to access the bulk of a 3 billion-krone ($283 million) package in loan guarantees. With most of its fleet grounded, the company has proposed a debt restructuring and capital increase by mid-May that would unlocking the cash it needs to survive the coronavirus crisis.