Nordic Aviation Capital (NAC, the Company), the world’s largest regional aircraft lessor, today announced that its lenders have voted unanimously to approve its proposed scheme seeking to implement a standstill on and deferral in respect of certain payment of interest and principal on its borrowings, covering the next 6-12 months.
The meetings of the Secured and Unsecured classes of scheme creditors took place earlier today. For the scheme to be approved, 75% in value and 50% in number were required to vote in its favour. NAC is delighted to report that the scheme was approved and that no lender voted against the proposal.
The positive vote clears the way for the Court to formally approval the scheme. The matter is back in court tomorrow Friday at 2pm for the purpose of providing an update on the creditor vote and to seek a hearing date for the sanction of the scheme. The hearing is likely to take place in or around 21 July 2020. The scheme provides a stable platform for the Company and allows it to continue to operate during this challenging period for the aviation sector.
Whilst NAC entered the current global crisis in a strong liquidity position, the fall out in the aviation sector as a result of the COVID-19 outbreak resulted in the Company receiving requests from the majority of lessees seeking to defer some or all elements of their lease payments. To mitigate this, the Company has been liaising with its lenders and their advisors since April to agree a standstill on and deferral of its debt obligations. This agreement will ensure NAC’s stability as the aviation market gradually recovers.
Søren M. Overgaard, CEO of Nordic Aviation Capital, said: “The COVID-19 pandemic has had a severe impact on businesses across the world, in every sector, but particularly for the travel industry. As is the case with other leasing companies, we have seen a number of our lessees severely challenged during the pandemic and we have granted them deferred payments of 40% of our revenue in the past 6 months”.
Gareth Halpin, Chief Funding Officer of Nordic Aviation Capital, said: “This agreement has required months of hard work between teams across the world. We have liaised with more than 85 lenders who have been very constructive and supportive, and we appreciate their trust in our people and our business model. We look forward to working alongside all of them as the economy begins to recover”.
The long-term equity shareholders EQT Partners, KIRKBI Invest, GIC and Martin Moller, its founder and Chairman, previously committed to investing $60m of new equity as a signal of their confidence in the prospects for the business and their support for its strategy.
NAC was advised by Rothschild & Co, Clifford Chance and McCann Fitzgerald.