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STOCK EXCHANGE

Oslo bourse hits record high

Oslo's stock exchange hit a record high Tuesday on the back of recovering oil prices and a strengthened dollar.

Published: 7 April 2015 17:46 CEST
Oslo bourse hits record high
Norwegian real estate firm Entra debuts on the Oslo Børs in 2014. Photo: Torstein Boe / NTB scanpix

The main share index OSEBX — which includes a large number of shares linked to the oil industry — reached 637.76 points by midday. 

Last summer another all-time high of 633.24 points was recorded, according to financial news site hegnar.no, also on the back of higher oil prices. 

"Asian markets are all up Tuesday morning. That can help European markets, at least in the opening minutes today. With the markets closed since Thursday investors need time to get updated," Roger Berntsen, an analyst at Netfonds Banks, wrote ahead of the opening.

"Among other things, oil prices have risen by four percent during this period while the dollar was strengthened by 1.5 percent," he added.

NORWEGIAN

Norwegian shares plummet by more than half on dilution fears

Shares in Norwegian Air Shuttle plummeted 63 percent when the Oslo Stock Exchange opened on Tuesday, as investors reacted to plans announced last week to convert a massive 44.5bn kroner ($4.3bn) of debt into new shares.

Published: 14 April 2020 13:15 CEST
Norwegian shares plummet by more than half on dilution fears
Is the sun finally about to set on Norwegian? Photo: David Charles Peacock
The fall was so sharp that the exchange was forced to place the shares under “special observation”, a measure taken only when valuations are extremely uncertain. The shares then rebounded and by Tuesday afternoon were trading at about a 30 percent down on where they ended the week last Thursday. 
 
Mads Johannesen, investment economy at the online share trading company Nordnet, said that the company's rescue plan threatened to severely dilute existing shareholders.  
 
“Existing stockholders today wouldn't be left with much if they decide to fully dilute the bonds and convert them into equity, so it doesn't look promising,” he told The Local. “I guess they're going to survive in some form, but how they're going to look coming out the other side depends on the negotiations.” 
 
 
The international brokerage Sanford C. Bernstein on Tuesday cut its target price for the company's shares to zero. 
 
“Norwegian is at the end of the line,” the brokerage's analyst Daniel Roeska wrote in a note to clients announcing the decision. “Rounded to the nearest Krone, existing shares are all but worthless.”
 
The Norwegian government last month made the overwhelming majority of the 3bn kroner in loan guarantees it offered the airline conditional it successfully swapping some of its near 80bn kroner debt pile for equity. 
 
Norwegian is now negotiating with banks and bondholders to convert more than half of its debt into shares, before putting the plan to existing shareholders at a meeting on May 4.
 
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