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SAS Airlines has filed for creditor protection in the US

SAS Airlines has filed for creditor protection in the US

“In order to continue implementing the significant points of the plan, SAS and some of its subsidiaries have voluntarily filed for Chapter 11 in the United States, a statutory financial restructuring that is being conducted under the oversight of a US federal court,” the statement said. .

At its own discretion, SAS Airlines has sufficient liquidity to meet its commercial obligations in the near future. However, the pilots’ strike, which began on Monday, has a negative impact on liquidity and the financial situation, and in the event of an extension, the impact of the strike on the economy could be significant.

The company expects to complete bankruptcy proceedings within nine to 12 months. During this time, you want to strike an agreement with key stakeholders, restructure debt, reconfigure the aircraft fleet and get an infusion of capital.

On Monday, wage negotiations between management and SAS pilots collapsed. So, pilots have begun to strike, threatening the future of airlines and contributing to travel chaos across Europe as the summer holiday season peaks.

Loss-making airline SAS is trying to restructure its business through sweeping cost cuts, raising fresh cash and converting debt into equity. The Swedish and Danish governments share the company. Copenhagen had previously said it was ready to provide SAS with another financial injection and write off the debt on the condition that the airline also finds private investors. Sweden rejected another injection, while Norway, which sold a stake in the airline in 2018 but still owns the airline’s debt, said it may proceed with converting the debt into equity.

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Sydbank analyst Jakob Pedersen estimated that the strike could cost SAS around 80 to 90 million DKK (266 to 300 million CZK) per day. According to him, the company’s ticket sales for future flights will also suffer from the strike.