Summary
- US bankruptcy court approves SAS Chapter 11 plan, which incorporates a $1.21 billion investment.
- The airline hopes to exit the Chapter 11 process by June.
- SAS says it’s going to emerge as a stronger airline.
Scandinavian Airlines (SAS) has received approval from a US court for its Chapter 11 bankruptcy plan. The carrier now expects to emerge from proceedings by the center of the 12 months.
SAS bankruptcy plan approved
At a court hearing in Latest York, US Bankruptcy Judge Michael Wiles granted approval to SAS’ reorganization plan. A second amended plan was submitted last month and features a $1.21 billion investment from a consortium including Air France-KLM, the Danish government, and investment firms Castlelake and Lind Invest ApS.
Photo: Matheus Obst | Shutterstock
The plan was reportedly approved by over 99% of its creditors, with the investment involving $725 million in secured convertible debt and $475 million in recent equity, with existing equity to be canceled. The deal will even grant junior creditors as much as $325 million in money and equity in the brand new company.
Anko van der Werff, President & Chief Executive Officer of SAS, commented,
The carrier entered bankruptcy proceedings in July 2022 and has taken significant steps to streamline its operations and cut costs. This includes renegotiating leases with at least 15 lessors involving 59 aircraft, helping it save at the least SEK 1.0 billion ($95.8 million) yearly in fees.
Exit bankruptcy by June
In accordance with SAS, it expects to exit Chapter 11 “around the tip of the primary half of 2024,” by which period it hopes to have the crucial approvals from various regulatory bodies, in addition to completing an organization reorganization in Sweden.
Van der Werff added,
As Easy Flying reported in November, the airline desired to exit Chapter 11 proceedings in early 2024, but this was pushed back in January.
![A SAS Boeing 737 landing](https://static1.simpleflyingimages.com/wordpress/wp-content/uploads/2023/09/shutterstock_115582378.jpeg)
SAS Receives $1.2 Billion Investment From Air France-KLM Backed Consortium
SAS filed for Chapter 11 bankruptcy protection last July.
Annual general meeting
The airline hosted its annual general meeting (AGM) on Monday, however the day was overshadowed by climate activists accusing SAS of greenwashing. Led by Greta Thunberg, activists said the carrier was not being honest about its sustainability and criticized the aviation industry’s contribution to carbon emissions.
Once the reorganization plan is complete, SAS will depart Star Alliance – of which it was a founding member – and turn out to be a brand new member of SkyTeam, to which Air France-KLM belongs. The airline group will initially take a 19.9% stake within the reorganized SAS, but has the choice to show this right into a majority stake after two years.
Are you joyful to see Scandinavian Airlines move closer to exiting bankruptcy protection? Tell us within the comment section.