Norwegian Air raises $168m after warning of bigger loss
Norwegian Air has raised US$168m in a share sale to help fund its expansion and cope with higher fuel costs after warning of a larger than expected loss in the current quarter. The budget airline is trying to crack the transatlantic market by undercutting established rivals but faces pressures to control costs and shore up its balance sheet. Its fate rests on the still unproven strategy of adapting the model of low-cost short-haul travel to longer routes. A share price decline of more than a third over the past year indicates that some investors have doubts. The company said on Wednesday it had sold shares at 155 crowns each, a 9.7% discount to Tuesday’s closing price. At 0948 GMT, the stock was down 3.1% at 166.2 crowns. “The equity issuance provides breathing space,” said Davy Research, which has a neutral rating on the stock. The airline is massively expanding its transatlantic network to try to win market share, with routes between Canada and Europe starting in July. It recently launched flights from Britain to Argentina, and will also fly within the south American country. It plans to raise its capacity by 40% in 2018.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2018-03-22/unaligned/norwegian-air-raises-168m-after-warning-of-bigger-loss
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Norwegian Air raises $168m after warning of bigger loss
Norwegian Air has raised US$168m in a share sale to help fund its expansion and cope with higher fuel costs after warning of a larger than expected loss in the current quarter. The budget airline is trying to crack the transatlantic market by undercutting established rivals but faces pressures to control costs and shore up its balance sheet. Its fate rests on the still unproven strategy of adapting the model of low-cost short-haul travel to longer routes. A share price decline of more than a third over the past year indicates that some investors have doubts. The company said on Wednesday it had sold shares at 155 crowns each, a 9.7% discount to Tuesday’s closing price. At 0948 GMT, the stock was down 3.1% at 166.2 crowns. “The equity issuance provides breathing space,” said Davy Research, which has a neutral rating on the stock. The airline is massively expanding its transatlantic network to try to win market share, with routes between Canada and Europe starting in July. It recently launched flights from Britain to Argentina, and will also fly within the south American country. It plans to raise its capacity by 40% in 2018.<br/>
