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OSLO, April 12 (Reuters) - Norwegian Air has won approval from creditors in Norway to restructure its debt and an Oslo court has approved the plan, the airline said on Monday, clearing the way for it to raise new capital and emerge from bankruptcy next month.
Financed largely by debt, Norwegian Air grew rapidly, serving routes across Europe and flying to North and South America, Southeast Asia and the Middle East before the COVID-19 pandemic plunged the airline into crisis.
Its survival plan announced last year brings an end to its long-haul business, leaving a slimmed-down carrier focusing on Nordic and European routes.
“Today the judge of the Oslo Byfogdembete (County Court) has approved the scheme for an exit of the reconstruction of the company,” Norwegian Air said in a statement.
Ireland’s High Court has already approved the airline’s restructuring scheme in a parallel process.
Norwegian plans to cut its fleet to 53 jets from 140 before the pandemic and slash its debt to 20 billion Norwegian crowns ($2.4 billion) from 56 billion.
“We are very pleased with this important positive decision by the court,” Norwegian Air Chief Executive Jacob Schram said following the latest ruling.
The airline’s next step is to raise at least 4.5 billion crowns from new shares and hybrid capital, of which Norway’s government has said it is willing to contribute 1.5 billion.
Norwegian has said it aims to exit the restructuring process on May 26, once it had secured new funding. ($1 = 8.4765 Norwegian crowns) (Reporting by Victoria Klesty; Editing by Gwladys Fouche, Terje Solsvik and David Clarke)