In an unexpected move, low-cost Norwegian Air fired CEO Jacob Schram, who led the carrier through the restructuring and replaced it with CFO Geir Karlsen, effective immediately. The board of directors voted on June 20 to end Schram’s mandate, which lasted 18 months. “The board’s decision to fire me was a big surprise,” Schram told Reuters news agency.
His replacement, Karlsen, has served as chief financial officer since 2018. For six months in 2019 he served as interim CEO of the carrier, which is recovering from receivership after the Covid-19 pandemic plunged the airline. heavily indebted, in a deep financial crisis. “It will be very interesting to see if we can make this company profitable – Karlsen commented to Reuters -. We now have a unique opportunity with Norwegian to create the company I have wanted for a long time. “
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The survival plan has closed Norwegian’s long-haul routes, leaving a leaner carrier with Nordic and European routes.The company declined to explain the reasons for Schram’s torpedoing, but said its replacement is the right person. “Karlsen has successfully led Norwegian’s financial reconstruction and has the skills, focus, confidence and dedication that make him the best choice as Norwegian CEO,” said Svein Harald Oeygard, chairman of the board of administration.
Karlsen’s annual base salary will be NOK 4.5 million (approximately € 440,000), unchanged from his CFO salary, but he will also receive a performance-based bonus and share options. Schram’s salary was 680,000 euros. The board clashed with Schram over his emoluments: he would be entitled to 15 months’ pay in addition to the nine-month notice period, or 1.4 million euros in 24 months. “The board has made an effort to bring severance payments to a level that reflects the challenges of the industry, but a deal could not be reached,” Norwegian said. Schram said he was willing to make concessions to adjust his pay, but also said no deal was reached.
Bankruptcy courts in Oslo and Dublin in May gave their approval to Norwegian to drastically cut debt by converting it into equity and raising new capital. The chairman, Oeygard, was appointed in early June after these proceedings were completed and new share capital was secured. The search for a new CFO has already begun.