A scheme of arrangement for Irish-based aircraft lessor Nordic Aviation Capital with its creditors has been approved by the High Court.
Nordic Aviation Capital DAC sought to enter into a scheme with its lenders due to the dire effects of the Covid-19 pandemic on the aviation industry.
The judge approved the scheme, which will allow the group to continue to operate, after being told over 90% of the different class of the group's creditors had approved the scheme.
Noting the level of approval and the lack of opposition to the proposal Mr Justice David Barniville said he was satisfied he had the jurisdiction to make the order sought, giving international recognition of the scheme, and that the scheme was "fair and equitable."
The NAC group of companies is the largest lessor of aircraft to regional airlines, and the fifth largest aircraft lessor in the world, and employs over a 100 people at its Limerick headquarters and owns approximately 500 aircraft.
Under the terms of the scheme millions of euro in principle and interest payments due from NAC to its lenders regarding over €5bn of debt, over the next six to 12 months, will be put on hold.
Other aspects of the scheme include that NAC 's shareholders will inject a total of US$60m into the group, and will reduce non essential expenditure, and cut costs.
The group also will also eliminate an uncommitted proposed capital expenditure programme for 2020 to 2025 of US$5.7bn.
In addition payments under a committed capital expenditure programme of US$1.5bn, and reduce the proposed delivery of 21 new aircraft down to eight will also be deferred.
Seeing orders under the Companies Act for the scheme's approval on Tuesday Lyndon MacCann SC, appearing with Kelly Smith Bl for NAC said that there had been overwhelming creditor support for the scheme.
Counsel said well over 90% of secured and non-secured creditors who had attended creditors meetings had voted in favour of the proposals contained in the scheme.
No party had objected to the scheme, counsel added. All relevant parties had been informed about both the creditors meetings and the application before the court to have scheme approved, counsel said.
James Doherty SC who said he represented an "ad hoc group of creditors who held just under 50% of the group's secured debt said that none of his clients opposed the scheme and just over 91% had voted in favour of the proposal.
Brian Kennedy SC told the court he represented a group which holds a total of 69% of the NAC's unsecured debt, which had "unanimously supported the scheme".
The group sought to enter into an arrangement with its lenders due to the impact of the Covid-19 pandemic. The court heard that unless the scheme got the go ahead it feared that it would run out of cash by the end of July.
The bulk of the group's customers sought various concessions on its aircraft leasing agreements. The pandemic had also resulted in a substantial decrease on the amount of money paid to the group, the court also heard.