Tuesday , January 26 2021

Cash points can be converted into shares – E24

The Norwegian board is seeking broader approval of the crisis plan to convert the debt into shares, as well as for obligations including currency points. However, analysts are not so sure that customers will sit with the stock.

Risk plan: The Norwegian government on Thursday unveiled a plan to cut debt and save the company.

John Injumandsen


The Norwegian note for a new rescue plan suggests that the company will have to write off a lot of debt in order to survive. This is done by the creditors exchanging loans for shares.

The proposals made on Thursday and the shareholders’ vote will be put to a vote at the General Assembly on December 17, which will give the Board broad powers to work together on such a package.

At the heart of the plan is debt restructuring. Although no information was provided on how much debt the Norwegians would like to cut, the resolution meant that “all or part” of the debt obligations would be converted into shares.

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Money points can be converted

Liabilities include so-called “cash scores” along with all other debt liabilities. This is Norwegian digital currency and can be used by customers to pay for air tickets.

The loan item includes cash points Other current responsibilities In accounts. This item is one of the proposed debt obligations to be converted in whole or in part on the Norwegian map for the rescue plan.

This means that theories in theory can also be converted into shares. But the board cannot be tapped through such a scheme. The resolution states that the conversion will take place as long as an agreement is reached with the relevant creditors.

Aeronautical analyst Hans Jගrgen Elnas believes that converting the dot point is not realistic.

– It seems like a complicated relationship. It requires consent and they have millions of customers. It doesn’t work, they don’t have time for it. It’s like you can’t do an operation. He tells E24 that achieving it is extremely complex and time consuming.

Read E24 +

It also feels like a Norwegian bankrupt solution

There will be a refund

It is not known exactly how many cash points customers have. But its assets rose 1.493 billion NOK from January to the end of September, according to the Norwegian report for the third quarter.

Cash points are one of the options that customers can choose to get a refund if their Norwegian flight is canceled.

Norwegian answers the following questions about whether this can be done with regard to cash scores and repayment liabilities and shares.

– Our goal is to get it to all customers who are actually entitled to a refund, although we are currently in the process of investigating, press officer Charlotte Holberg Jacobson writes in an email

The exam is a proposal to protect Ireland from bankruptcy, which Norwegians applied for in November.

When Norway announced on November 18 that it was seeking bankruptcy protection for its Irish companies, The company assured customers The prize giving program should continue as usual and members can continue to earn and use cash points.

The Norwegian national emphasizes that the money point program is not part of the Irish trial process.

The company emphasizes that there is no point in converting money into points. The Norwegian Terms and Conditions state that monetary points cannot be converted into cash and that they expire after a certain period of time, and that the Company may terminate your membership in the Rewards “at any time, for any reason or at its sole discretion.” Does.

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Management can receive a salary from the shares

It is not only creditors who can get a settlement of shares. The Norwegian board has allowed top management to pay salaries in installments instead of cash.

In this proposal, the Norwegian Board provides a comprehensive framework for the conversion of any loan into shares.

Including both gross debt and leasing liabilities, the total debt liabilities are around NOK 73.4 billion.

This is the total amount authorized by the Norwegian Board to exchange shares, but the return depends on an agreement reached with the creditors.

In the proposal, anything between zero and this total amount can be divided into shares.


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