Norse Atlantic Boeing 787-9
Norse Atlantic has raised $110 million in gross proceeds through a rights issue to strengthen the airline’s financial position. At the same time, the Norwegian carrier has launched a strategic review that could result in a sale, merger, or partnership, it said on Wednesday.
The rights issue at NOK 0.5 per share was announced on Tuesday and was substantially oversubscribed by existing and new investors. They include Norse’s largest shareholder, B T Larsen & Co (29.5 percent), which had pre-committed to subscribe $30 million. Another major shareholder, Songa, has underwritten $15 million in the rights issue. CEO Eivind Roald subscribed for six million shares.
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Start My Test Flight →Norse Atlantic will use the proceeds to repay $20 million on an overdraft facility, $25 million to pay dues to lessors and suppliers, and the remaining $65 million for general corporate purposes. The rights issue is subject to approval by the shareholders at an extraordinary meeting on June 2. Norse already raised $11.4 million through a private placement in August last year and had planned to raise about $90 million in late 2025, but the offering was canceled because its stock price was below the threshold.
Bridge loan
The airline also obtained a $70 million bridge loan facility “to fund its liquidity needs pending completion of the rights issue and the effects of the accelerated implementation of cost-saving initiatives.” Norse launched the cost-saving Project Falcon last year, which aims to reduce annual costs by $40-$45 million. About 80 percent of the cost-reduction measures have already been identified and are being implemented, such as optimizing the network and fleet allocation to support a leaner, more efficient cost base.
Norse exited the winter season on a strong basis and reported good results for March, with unit revenues up 59 percent to $6.4 cents per kilometer. Passengers carried grew by 14 percent to 124.000. Demand for direct flights between Europe and Asia is strong, as the Gulf region has lost transit capacity due to the conflict in Iran. The airline has placed six Boeing 787-9s on long-term lease with IndiGo and operates the two remaining aircraft on its own network or on charters.
Strategic partners
While this shift to combined ACMI and own operations guarantees Norse a stable income and improves its financial position through cost reductions, the carrier is in the process of “engaging a financial advisor to launch a strategic review, expected to be concluded within 2026.”
In a media statement, Norse says today: “The Company has, over time, received interest from potential strategic partners to explore structural opportunities with the Company and is in advanced preparations with an international investment bank to initiate a strategic review to explore strategic alternatives to unlock the underlying value of the Company and its assets. These strategic alternatives may include a sale, merger, or partnership. No indicative offer has been received, and no agreement has been reached on the principal terms.”
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