Budget airline Norwegian Air has today secured a long-sought credit guarantee from Norway's government after completing a debt restructuring.

The move will allow it to survive in a slimmed-down version.

Following the grounding of almost all its fleet due to the coronavirus pandemic, the company had said it would run out of cash by the middle of May unless it was able to qualify for the 2.7 billion Norwegian crowns ($271 million) state package. 

The government in a separate statement confirmed the airline would get the guarantee.

Norwegian had already secured a $30m payout at an earlier stage, taking the overall loan to $301m. 

Bondholders, lessors and shareholders agreed in recent weeks to a 12.7 billion crowns debt conversion and share sale that boosted Norwegian's equity ratio to 17% from 4.8% at end-2019.

This exceeded the minimum government requirement of 8%.