The Bankruptcy Court for the Southern District of New York has formally approved SAS’ Chapter 11 reorganisation plan, with the Scandinavian airline expecting to emerge from the process around the end of the first half of 2024. SAS will continue to serve its customers throughout the process with its operations and flight schedule to ‘remain unaffected by the restructuring proceedings’.
The carrier initiated voluntary Chapter 11 proceedings in the US ‘in order to accelerate the implementation of its comprehensive business transformation plan,’ it notes; aiming to reach agreements with key stakeholders, restructure debt obligations and emerge ‘with a significant capital injection’. 99% of its voting creditors supported the approved Chapter 11 plan.
As part of the plans to reconfigure its aircraft fleet, SAS has reached extended lease agreements with 15 lessors, affecting 59 aircraft. These renegotiated lease agreements (and annual cash flow items relating to aircraft financing) should save SAS at least SEK 1bn ($95 million) annually.
SAS has also selected Castlelake, Air France-KLM and Lind Invest, along with the Danish state, as the winning bidder consortium in a ‘competitive exit financing solicitation process’. The agreed transaction structure includes investment of $1,200 million, including $475 million in new unlisted equity and $725 million in secured convertible debt.
Describing the plan as setting a “clear path to exiting the restructuring proceedings,” SAS president and chief executive officer Anko van der Wreff added: “We look forward to emerging as a competitive and financially stronger airline with a stable equity structure”.
Weil, Gotshal & Manges LLP is serving as global legal counsel and Mannheimer Swartling Advokatbyrå AB is serving as Swedish legal counsel to SAS. Seabury Securities LLC and Skandinaviska Enskilda Banken AB are serving as investment bankers, and Seabury Securities LLC is also serving as restructuring advisor to SAS.
SAS receives court approval of Chapter 11 restructuring plan
