Estonian airline Nordic Aviation Group has gone bankrupt

Estonian state-owned Nordic Aviation Group (NAG), which includes Nordica and Xfly airlines, plans to cease operations and file for its own bankruptcy. This was reported on November 20 on the website of the global aviation service Aerotime Hub.

In the materials of the service specifies that in October this year, NAG lost its contract with its main partner SAS to serve domestic routes in Sweden. The Swedish company stated that such cooperation was unprofitable.

It was decided to sell Nordica to the owner of the Danish airline Jettime and a minority shareholder of the Latvian airBaltic Lars Tusen. But the potential investor informed the company of his intention not to proceed with the privatization because the risks involved were too high.

"The management board has therefore informed the supervisory board of its intention to terminate Nordic Aviation Group and Xfly and to initiate the necessary procedures for filing for bankruptcy," NAG supervisory board chairwoman Kadri Land told NAG.

The company has informed its employees and partners of its intention to file for bankruptcy.

"Our goal is to hand over the aircraft used by Nordic Aviation Group and Xfly to the lessors as soon as possible, most likely in the next few days. This is accompanied by all relevant formalities applicable to bankruptcy proceedings, including notification to the Estonian Unemployment Insurance Fund," explained Remko Altuis, CEO of NAG.

According to Aerotime Hub, Nordica and Xfly's current active fleet includes one A320-200 and three Bombardier CRJ 900ERs. Nordica's website says its fleet has 19 aircraft, including nine Bombardier CRJ 900s, nine ATR72-600s and one Airbus A320.

Earlier, on November 13, it became known that Russian airlines fear deterioration of financial situation and revocation of operator certificates due to accumulated debts for leasing foreign aircraft.

With the introduction of sanctions in 2022, many of them stopped transferring leasing payments. In 2025, Russian businesses will have the right to write off such debts for foreign aircraft. But they will be assessed an increasing profit tax of 25% on these amounts from next year.