Norwegian announces a capital increase and sinks more than 14% on the Oslo Stock Exchange

Norwegian announces a capital increase and sinks more than 14% on the Oslo Stock Exchange


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Waiting next week of the 2018 balance sheet and after the IAG group (Iberia, Aer Lingus, Vueling and British Airways) ruled out a takeover bid for it, Norwegian – which suffers its second crash in a week to minimum since 2012 – has announced this Tuesday that will resort to a capital increase: it will strengthen its accounts by some NOK 3,000 million (308 million euros), practically half of the market capitalization with which it closed the session on Monday. Following the announcement, the shares of the Norwegian low-cost airline have fallen 14.60% on the Oslo Stock Exchange.

The Scandinavian airline that calculates that the subscription period for shares begins on February 22 and ends on March 8, has informed in a statement that the main shareholders – its executive director, Bjørn Kjos, and the chairman of the Board of Directors, Bjørn Halvor Kise – have committed themselves to subscribe titles for 343 million of crowns (35.3 million euros), as well as «other large shareholders», for about 267 million (27.5 million euros). The remaining amount will be subscribed by other external groups, among them Sterna Finance, from owner John Frederiksen, considered the richest man in Norway.

«Norwegian has gone through a period of significant growth. From now on, the focus will be on tocost savings and reduction of capital expenditures », Kjos said in a statement. In a subsequent press conference, Kjos affirmed that the company has completed the route and fleet expansion carried out in recent years and has been confident that it will give benefits in 2019. Preliminary data advanced on Tuesday in the statement of the balance for 2018 are instead negative: the net loss of exploitation has amounted to 3,800 million of Norwegian crowns (391 million euros), compared to 2,001 million euros (206 million euros) a year ago.

IAG announced last Thursday that discarded an OPA on Norwegian and that it will sell its stake in the company, which is 3.93%, which caused the collapse of the shares of the low-cost airline, which fell that day by 21.48%. The entry of IAG into the shareholders of Norwegian sought to initiate conversations with the airline's management to present a complete offer, a possibility on which no agreement was reached and which was ruled out. Norwegian assured last May that it had rejected two offers of IAG because it considered that they underestimated the company and its future prospects.

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