SAS Group and its debtor subsidiaries, including SAS Scandinavian Airlines (SK, Copenhagen Kastrup), will remain in US Chapter 11 bankruptcy protection until January 8, 2024, following a decision by the US Bankruptcy Court in New York to extend by 100 days the exclusivity period for the presentation of a restructuring plan to allow the debtors to conclude an equity solicitation process.

This is according to an order passed on August 10, 2023, by US Bankruptcy Court judge Michael E. Wiles in the SAS Group's ongoing Chapter 11 case (No. 22-10925) after finding that a motion to this effect was "in the best interests of the debtors, their estates, their creditors, and all parties in interest". Other documents before the court state that extending the period during which the debtors have the exclusive right to file a Chapter 11 plan will allow them to complete the process of soliciting equity to facilitate the best Chapter 11 exit plan. Terminating exclusivity at this time would counter meaningful progress being made.

The previous deadline for the presentation of the restructuring plan had been November 8, 2023, after already being extended on April 13, 2023. The court said it received no objection to the SAS Group's July 31, 2023, motion to extend the exclusivity periods further. The extension was granted without prejudice to any further requests for further ones.

The official committee of unsecured creditors supported the motion, which said it was working closely with the debtors to obtain equity financing on the most favourable terms. "Thus far, the process has yielded very promising results. Specifically, the committee understands that in mid-July (2023), the debtors received multiple first-round proposals for potential [Chapter 11] exit transactions. In the weeks since then, the debtors' advisors have worked tirelessly to develop these competing bids in order to generate the exact type of competitive dynamic that the committee hoped for at the outset of the process. The committee looks forward to continuing to work with the debtors, their advisors, and bidders to further develop these promising alternatives in advance of the final bid deadline in mid-September [2023]," it advised.

According to the SAS Group's July 31 motion to extend the deadline, the debtors, assisted by their advisors Seabury Securities LLC and Skandinaviska Enskilda Banken AB, "have contacted hundreds of potential investors, executed non-disclosure agreements (NDAs) with interested parties, and engaged in ongoing discussions with parties interested in submitting bids". It added: "This process remains ongoing – initial indications of interest were submitted on July 17, 2023, and final bids are due on September 18, 2023. The Debtors are working collaboratively with key stakeholders, including the creditors' committee and the states, to review and further assess the initial indications of interest and viability of an exit transaction."

In addition, the debtors continued to take action for improved earnings and cost savings, including renegotiating aircraft leases and other contracts with lessors, suppliers, and vendors.

SAS Group agreed with New York-based private equity firm Apollo Global Management in August 2022 to raise USD700 million in financing in two equal-sized tranches to help it complete its Chapter 11 restructuring process. It opted not to use the second tranche during the second quarter of 2023 because of a stronger-than-expected liquidity position.

The SAS Group and its subsidiaries have been in voluntary Chapter 11 bankruptcy protection since July 5, 2022, but are authorised to continue operating as debtors in possession. The airline had SEK7.8 billion Swedish kronor (USD755 million) in cash on June 30, 2022. Under the SAS Forward restructuring plan, it needs to raise SEK9.5 billion (USD920 million) in new equity capital and reduce/convert more than SEK20 billion (USD1.9 billion) of debt into common equity.