Shares in Norwegian Air fell more than nine per cent this morning after the struggling airline last night launched its third share sale in two years and a bond issue.
The company raised 2.5bn kr (£211.5m) to meet its cash needs through 2020 after selling 27.25m new shares at 40 kr per share.
Norwegian Air also raised $150m through a convertible bond issue.
Shares were down 9.47 per cent this morning at 41.70 kr.
“The private placement received significant interest from both existing shareholders in the company and new high-quality investors. The convertible bond issue received significant interest from international and domestic investors,” the company said.
“The proceeds … will secure required financing of working capital during the winter season and create headroom to financial covenants while completing the strategic transformation of the company,” Norwegian added.
Engine issues and the grounding of its 18 Boeing 737 Max aircraft have put a halt on Norwegian’s expansion plans as the airline seeks to cut costs.
Last month, the company entered into a joint venture with a subsidiary of China Construction Bank to add 27 Airbus aircraft to its fleet.
The Chinese bank will own 70 per cent of the venture, which will allow Norwegian to purchase the Airbus A320neo planes between 2020 and 2023.
Norwegian said the deal would ease financial pressures by cutting its capital expenditure by $1.5bn.
The airline recently reported strong third quarter results, as net profit increased 28 per cent to 1.7bn kr and revenue jumped eight per cent to 14.4bn kr.
Main image credit: Getty