Nordic Aviation Capital, the world’s largest regional aircraft lessor, has filed for Chapter 11 bankruptcy in the US to restructure its debt.
Documents filed in the US Bankruptcy Court for the Eastern District of Virginia indicate that NAC filed for Chapter 11 bankruptcy late on December 17th.
In its filing with the U.S. bankruptcy court, NAC said it estimated it had between 1,000 and 5,000 creditors, estimated liabilities of $ 1 billion to $ 10 billion, and assets of $ 1 billion to $ 10 billion.
Funds will be available for distribution to unsecured creditors, says the application, which later lists the 30 largest unsecured creditors (see table at the end of the article).
The representative of NAC in the application to the court says: “The debtor” [NAC] calls for discharge in accordance with Chapter 11 of the United States Code identified on this petition. “
Unlike some other countries’ bankruptcy proceedings, US Chapter 11 bankruptcy is one way businesses can get financial relief and restructure their debts.
This is the second time NAC has attempted to restructure its debt. In July 2020, NAC issued a statement stating that “its lenders had unanimously voted to approve their proposed plan, which aims to put a halt and postponement on certain interest and principal payments on their loans for the to be introduced next 6-12 months. “
The international law firm Linklaters, which represented lenders, namely banks and financial institutions, said in a statement last December that this previous financial restructuring involved $ 6 billion in debt.
The restructuring used a solvent Irish regulatory scheme sanctioned by the Irish High Court and recognized under Chapter 15 of the US Bankruptcy Act, Linklaters says.
The arrangement included postponing principal and interest payments on NAC’s bonds for a period of 12 months, she added.
NAC’s Chapter 11 filing for bankruptcy dated December 17, 2021 in the U.S. Bankruptcy Court
|Name of the unsecured creditor||Unsecured claim|
|1||PFA Pension (a Danish pension fund authorized to manage and invest the pension funds in employees’ retirement accounts)||$ 522,971,000|
|3||MTU Aero Engines||$ 1,423,000|
|4th||Pratt & Whitney Canada (Singapore)||$ 1,200,000|
|5||Titan International Finance||$ 1,086,000|
|6th||Pratt & Whitney Canada (Canada)||$ 1,000,000|
|7th||De Havilland Aircraft of Canada||$ 530,000|
|8th||Skyservice FBO||$ 419,000|
|9||Lufthansa Technik Aero Alzey||$ 375,000|
|10||APD aircraft delivery||$ 268,000|
|11th||Coopersa RL||$ 250,000|
|12th||Rheinland Air Services||$ 240,000|
|13th||Wojskowe ZakÅady Lotnicze||220,000|
|14th||SAMCO aircraft maintenance BV||$ 197,000|
|fifteen||Maastricht Aviation Aircraft Services||$ 172,000|
|16||Focus.Aero apps||$ 160,000|
|18th||Park Aviation||$ 118,000|
|19th||Direct maintenance BV||$ 70,000|
|20th||StandardAero France||$ 59,000|
|21||Magnetic MRO AS||$ 56,000|
|22nd||Azerbaijan airline||$ 50,000|
|23||ATR GIE||$ 50,000|
|24||Fokker Services Asia||$ 48,000|
|25th||PT Tobe Aviasi Indonesia TMB||$ 44,000|
|26th||Ascent Aviation Services||$ 42,000|
|27||Honeywell International||$ 42,000|
|28||PT Gapura Angkasa||$ 39,000|
|29||Embraer aircraft maintenance services||$ 34,000|
|30th||SkyOn aircraft construction||$ 26,000|
Note: Numbers are in US dollars and are rounded to the nearest thousand.
NAC is the world’s largest regional aircraft lessor with more than 500 aircraft in its portfolio, including aircraft from Airbus, ATR and De Havilland Aircraft of Canada.
The company announced in September that it had had $ 2.36 billion in the 12 months ended June 30, 2021.
NAC has suffered financially because it was badly exposed to some of the airlines that have come under control as a result of the pandemic.
German regional airline LGW Luftfahrtgesellschaft Walter, which had a fleet of 15 Dash 8-400 aircraft, went into voluntary management in April 2020. The entire fleet was leased from NAC.
NAC was also the largest lessor to the British regional airline Flybe, with 18 of Flybe’s 54 aircraft. Flybe entered the administration in March 2020.
In Asia, NAC was affected by Garuda Indonesia, which unilaterally announced that it would return its 12 Bombardier CRJ1000s it had rented from NAC before the expiration of the leases, which NAC immediately challenged.
Garuda also announced that it will return eight of its 19 ATR 72s. NAC is Garuda’s largest ATR lessor.
The founder and main shareholder of NAC is the Danish billionaire Martin MÃ¸ller Nielsen. But in 2015 Swedish investment company EQT and Danish investment company Kirkbi bought NAC, followed by the Singapore government mutual fund GIC in 2019. Kirkbi is the investment arm of the Kristiansen family, the Danish family behind The Lego Group.