Key shareholders in Norwegian ferry operator Fjord Line are injecting fresh capital into the company in a bit to ensure continued operations.

Frode Teigen and Johan H Andresen’s family company Ferd are leading the effort that will also see lenders, staffers and Norwegian authorities contribute.

Fjord Line describes the move as a voluntary action.

The effect of the package is NOK 700m ($67.3m) in positive cash flow this year in addition to cost-cutting measures, the company said.

Fjord Line did not disclose the total fresh equity, as the matter will formally be decided in a shareholders meeting.

Pride in achievement

“We are one of the first large travel groups in Norway that has completed such a process. We are a bit proud of this,” Fjord Line chief executive Rickard Ternblom told Norwegian financial daily Finansavisen.

Norway's Fjord Line and competitor Color Line have seen almost all their income disappear as borders with other countries closed in March.

Both companies were included in a cash support arrangement from the government, but for Fjord Line, this was not sufficient and required further help from lenders.

“We have arranged a new finance platform where pay instalments have been postponed and interest is accumulating,” Ternblom said.

“This crisis is not over. The effects will be long lasting, but we have got the work peace that we need to go forward.”

According to company data, 2019 was a record year for Fjord Line in terms of revenue and profit.

'On solid footing'

“We will now be able to get through 2020 and be ready for a more normal year in 2021. We are now on a solid footing,” Ternblom said.

Fjord Line was started in 1993 and is today Norway’s second biggest ferry operator of passenger and cargo between Norway, Sweden and Denmark with a market share of 21%.

The company owns and operates four ferries.

Egersund-based Frode Teigen controls 52.2% of the shares in Fjord Line through his companies Kontrari and Kontrazi.

These interests also control about 60% of the shares in Oslo-listed bulker owner Belships.

Johan H Andresen’s Ferd owns 44.6% of Fjord Line.