Embattled carrier Norwegian Air has entered restructuring proceedings under Irish law after its government refused to prop it up with further state cash.
Under the process, known as “examinership”, the airline will get 100 working days to secure new capital, reduce its debt pile, and “resize” its fleet.
The carrier said that it would continue to fly its existing network while the restructuring takes place.
Norwegian has chosen to use Irish law because its aircraft assets are held in the country.
Under the law, the company will have protection from its creditors for the duration of the process.
Chief exec Jacob Schram said: “Seeking protection to reorganise under Irish law is a decision that we have taken to secure the future of Norwegian for the benefit of our employees, customers and investors.
“Our aim is to find solutions with our stakeholders that will allow us to emerge as a financially stronger and secure airline.”
Earlier this month it was revealed that the Norwegian government had rejected the airline’s pleas for more state aid, having already bailed the carrier out in the spring.
The lack of new cash means that the carrier is glaringly exposed to the downturn caused by the coronavirus pandemic, with many analysts tipping the airline for imminent failure.
It warned that it was on track to run out of money in the first quarter of 2021 without imminent extra support.
The airline’s staff today protested outside of Norway’s parliament building against the decision to withhold new funding.
Norwegian insisted that it had enough cash to go through the restructuring process.
The airline said that safeguarding as many jobs as possible would be its priority while it attempts to stabilise its asset base.
“Our intent is clear. We will emerge from this process as a more financially secure and competitive airline, with a new financial structure, a rightsized fleet and improved customer offering,” said Schram.