SAS gets $1.5 bil­lion pack­age to sur­vive crisis

Arab News - - Business News - AP Stock­holm

Scan­di­na­vian Air­lines said it is get­ting an aid pack­age worth 14.25 bil­lion kro­nor ($1.5 bil­lion) af­ter an agree­ment with its main share­hold­ers, se­cur­ing the car­rier’s sur­vival amid the COVID-19 crisis. The gov­ern­ments of Swe­den and Den­mark, which own shares in the air­line, were partly fi­nanc­ing the re­cap­i­tal­iza­tion plan, SAS said in a state­ment.

The aid pack­age was also fi­nan­cially sup­ported by its third main owner, the Knut and Alice Wal­len­berg Foun­da­tion, a Swedish pub­lic and pri­vate foun­da­tion.

The pack­age in­cludes is­su­ing new shares and con­vert­ing bonds into shares.

In the state­ment, SAS said that amid the global travel re­stric­tions caused by the pan­demic it had taken mea­sures “to rad­i­cally re­duce costs as a re­sult of the de­cline in de­mand, which is not ex­pected to re­turn to pre-COVID-19 lev­els be­fore 2022.” The re­cap­i­tal­iza­tion plan is sub­ject to ap­provals by a share­hold­ers’ meeting and the Euro­pean Com­mis­sion.

SAS Chief Fi­nan­cial Of­fi­cer Tor­b­jorn Wist told a news con­fer­ence that he ex­pects ap­proval by the Com­mis­sion of the Dan­ish and Swedish gov­ern­ment aid. Swe­den holds nearly 15 per­cent and Den­mark some 14 per­cent of the shares.

CEO Rickard Gustafson said the COVID-19 crisis will af­fect avi­a­tion de­mand for years to come. In April, SAS’ seat ca­pac­ity was down 95 per­cent and 90 per­cent of staff were on tem­po­rary lay-offs, the air­line said.

“In early March, overnight we had a dif­fer­ent world to man­age,” Gustafson said. “It is a dif­fer­ent game now.”

Gustafson said SAS had set a 4 bil­lion-kro­nor ($429 mil­lion) cost cut­ting plan that in­cludes shed­ding up to 5,000 full-time po­si­tions — roughly half of the to­tal work­force. En­vi­ron­men­tal ac­tivists spoke out against res­cu­ing an in­dus­try that emits high lev­els of cli­mate­warm­ing gases like CO2.

FASTFACT

SAS has set a 4 bil­lion-kro­nor ($429 mil­lion) cost-cut­ting plan that in­cludes shed­ding up to 5,000 full-time po­si­tions.

AP

Scan­di­na­vian Air­lines is get­ting an aid pack­age af­ter an agree­ment with its main share­hold­ers, se­cur­ing the car­rier’s sur­vival amid the COVID-19 crisis.

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