Norwegian offered largest share of airline state guarantee package

Norway’s govt is providing a conditional state loan guarantee for its aviation industry amounting to NKr6b (US$533m), and is securing a minimum level of flight operations in the country. Half of the funding, NKr3b, will be directed at embattled Norwegian, with another NKr1.5b for SAS. The remaining NKr1.5b will be split between Wideroe and other carriers. The scheme will be arranged through the export credit institute GIEK, with the Norwegian govt providing 90% of the guarantee and external parties the remaining 10%. Conditions are being attached to the guarantees, including a minimum 8% equity requirement. While SAS and Wideroe meet this equity criterion, Norwegian will only be provided with an initial NKr300m until it achieves a reduction in interest and repayments to creditors. <br/>