SAS confirms Swedish restructuring plan
Scandinavian Airlines (SAS) has confirmed it is to enter a restructuring programme in Sweden, including provision for $1.2billion of investment, with the company to continue operating flights as…
June 12, 2024
Scandinavian Airlines (SAS) has confirmed it is to enter a restructuring programme in Sweden, including provision for $1.2billion of investment, with the company to continue operating flights as usual.
The SAS FORWARD transformation plan was initially launched in February 2022, with the company citing “difficulties in reaching agreements with key stakeholders and a pilot strike in July 2022” leading the company to initiate voluntary Chapter 11 proceedings in the United States the same month. Although the initiative was “initially intended to be implemented through voluntary agreements,” it proved “difficult to reach voluntary agreements of concessions with some key stakeholders”.
The District Court of Stockholm subsequently granted company reorganisation to SAS in March 27, with the administrators noting the US Chapter 11 filings were “necessary to renegotiate critical lease agreements”, taking advantage of “an extensive market for reorganisation loans in the US that is not available in Sweden”.
Of SAS’ approximately 200,000 shareholders, the three largest are the Danish State (21.8%), the Swedish State (21.8%) and Wallenberg Investments (3.42%). Following an “extensive capital raising process,” a total of $1.2 billion of investment into SAS has been pledged from a consortium consisting of Castlelake, Air France-KLM, Lind Invest Alps and the Danish State.
“The financial outcome for the parties concerned under the reorganisation plan is no worse than it would have been in the event of the company’s bankruptcy,” concludes the company’s administrators, who describe the restructuring plan as having “very good prospects of securing the viability of the company’s business”.
