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The dynamic low cost carrier Norwegian has this spring been courted by two of the world`s leading aviation players.

In May it was revealed that Norwegian had rejected two offers from IAG for the airline on the grounds, who in April, acquired a 4.6% stake in the Norwegian. In June in it emerged that Norwegian were in talks with Lufthansa about acquiring the airline.

Norwegian is an innovative low cost carrier which has rapidly expanded far beyond its Norwegian home market, handling 33 million passengers in 2017. The airline operates a modern fleet including a growing number of Boeing 787 Dreamliners, which it is using to expand into the long-haul market.  It is the long-haul routes which are of interest to IAG and Lufthansa, as it’s a sector they are both keen to enter as well as giving an increased exposure to Northern European Routes.

A suitor for Norwegian would have to take on its high levels of debit, which Norwegian has accumulated and many industry observers consider un-sustainable. Indeed according to financial analysts, Norwegian’s debit levels are so high that it needs to find a buyer soon or face bankruptcy, possibly as soon as this autumn. The airline is 75% owned by small and institutional investors, under the circumstances making it a prime takeover target. Lufthansa would be a better match for Norwegian than IAG.

So far Lufthansa have struggled to find the correct formula in the growing Low-Cost segment, including long-haul, where Norwegian have been successful.  Should Lufthansa acquire Norwegian it will propel its ranking from the world`s fifth to second largest airline globally by volume behind Delta.  In revenue terms the overlap between the airlines is negligible with just 1.5% of Norwegian’s revenues arriving from Lufthansa`s core German market, nor is there any overlap in-terms of long-haul routes from Germany.

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