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(Alliance News) - DP Aircraft I Ltd said Monday it has not received lease payments due March 13 from Torskefjorden Leasing Ltd, part of Norwegian Air Shuttle ASA.
DP Aircraft said Norwegian Air was unable to pay the leases on two aircraft, LN-LNA and LN-LNB, due to the "unprecedented pressure placed upon the airline industry" from Covid-19.
DP Aircraft noted that Norwegian has received a NOK3 billion, about GBP226 million, bailout from the Norwegian government.
"In these circumstances, the board has opted to reserve its position under the two leases until there is greater clarity as to how the negotiations develop. The board, and the company's asset manager, DS Aviation, will prioritise discussions with Norwegian in order to determine whether and on what basis it may be able to meet its obligations to the company under the leases for the assets," DP Aircraft said.
The company said it will continue to monitor the situation and is prepared, if necessary, to cancel dividend payments.
DP Aircraft added: "In the meantime, the board remains focused on preserving the long-term financial stability of the company. All other lease payments continue to be forthcoming and on time."
The company's liquidity reserve currently sits at USD6 million
"The board has already taken the precautionary steps of appointing advisers and implementing preliminary initiatives with a view to protecting the value of the assets," DP Aircraft added.
Shares in DP Aircraft I were untraded in London on Monday but last closed at USD0.28.
By Paul McGowan; paulmcgowan@alliancenews.com
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