Norwegian Air has filed for examinership in Ireland (where its aircraft assets are held), as it seeks protection from its creditors in an attempt to restructure its business and survive the coronavirus pandemic.
Examinership, which is the rough equivalent of Chapter 11 bankruptcy in the United States, allows companies to seek a court’s protection from creditors for up to 100 days.
CNN reports that the purpose of the process is to reduce debt, rightsize the fleet and secure new capital. The carrier warned last week that it would need additional cash to continue operating through the first quarter of next year and beyond. It received a state-backed loan of $288.7 million in May.
Its quarterly operating loss amounted to $310 million, while cash and cash equivalents fell to $376 million at the end of September.
Norwegian Air is a Norwegian low-cost airline and Norway’s largest airline. It is the third-largest low-cost carrier in Europe behind EasyJet and Ryanair, and the ninth-largest low-cost airline in the world.
In April this year, the airline announced plans to lay off 4,700 pilots and crew members as it grappled with the negative impacts of COVID-19 that saw all its international flights suspended.