Norwegian Air's top owner cuts stake amid debt crisis

[OSLO] Leasing firm AerCap Holdings has cut its ownership stake in crisis-hit carrier Norwegian Air to 9 per cent, it said on Wednesday, as the company's staff demonstrated in front of parliament against the government's decision to deny more aid.

Norwegian earlier this year converted a portion of its debt into shares as part of a financial rescue package, making AerCap its largest shareholder with a 13.4 per cent stake as of Sept 30, and giving other leasing firms substantial ownership in the carrier.

AerCap in June took a seat on Norwegian's board, but its representative resigned last week.

Despite the earlier rescue package, which included a government loan guarantee, pandemic-hit Norwegian Air could still run out of cash in the first quarter of 2021 unless it secures funding, the carrier has said.

An AerCap spokeswoman declined to comment when asked about further share sale plans.

Also on Wednesday, around a hundred Norwegian Air employees in uniform demonstrated in front of the country's parliament to seek more state support for the airline and the rest of the industry.

They carried signs with slogans such as "Support Norwegian","Save our jobs" and "Red nose warriors" referring to the distinctive colour of the tips of the carrier's planes.

"I hope the government can help us," said cabin crew Stina Nielsen, 31. "This is my life. We want to be able to go back to work." Inside parliament, Conservative Prime Minister Erna Solberg, who rules in a minority, repeated the government's reluctance to provide more direct financial aid for Norwegian, arguing it would primarily benefit foreign creditors.

Norwegian should seek to refinance or restructure its balance sheet, she said, pointing to the carrier's net interest-bearing debt of US$5.4 billion as a major obstacle.

"We've told Norwegian Air that we don't have any money for equity," Ms Solberg told parliament. "The ball is now in their court." In addition to its remaining shares, AerCap also holds bonds in Norwegian which could be converted into an additional stake of 5.9 per cent.

REUTERS