SAS files for US bankruptcy protection to enforce restructuring

STOCKHOLM–SAS AB announced on Tuesday that it had filed for Chapter 11 bankruptcy protection in the US as it seeks to pursue its sweeping financial restructuring to cut costs and raise capital under US court system oversight.

Struggling with high debt and lack of money, SAS SAS,
Earlier this year, plans were introduced to reduce annual costs by 7.5 billion Swedish kronor (US$725.2 million), converted around SEK 20 billion of debt and hybrid bonds into share capital and raised at least SEK 9.5 billion in new capital .

The Scandinavian airline was also hit by a pilots’ strike that began Monday and expects to cancel about 50% of its daily scheduled flights, affecting about 30,000 passengers a day.

“SAS has prepared for the possibility of pursuing a court reorganization to settle the company’s financial position,” said Carsten Dilling, SAS CEO.

“The ongoing strike poses significant challenges to our ability to succeed with our transformation. The Board has concluded that legal tools are necessary to make progress in our ongoing negotiations with key stakeholders and ultimately to successfully transform SAS into a competitive and financially strong company,” he said.

SAS said it expects to complete its US court-supervised trial in 9-12 months.

Write to Dominic Chopping at SAS files for US bankruptcy protection to enforce restructuring

Brian Lowry

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