A consortium of foreign investors has hired advisers with the goal of taking over SAS Scandinavian Airlines (SK, Copenhagen Kastrup), anonymous sources told the Swedish financial daily Dagens Industri on the evening of June 1.
However, any investment in the airline - which confessed the previous day that it needed a new capital injection of SEK9.5 billion kronor (USD969 million) - would be conditional on “a far-reaching recast” of the carrier’s debt pile and cost base, the newspaper said. It must also be on the condition that SAS meets the requirements of its own ambitious restructuring plan.
The identity of the investors, said to consist of non-Swedish financial institutions, was not revealed in the report.
The loss-making airline, which is part-owned by Sweden and Denmark, said in February that it had launched a new “transformation plan” that aims to save SEK7.5 billion (USD786 million) a year. It also said it was looking to raise further capital as it confronts widening losses, high costs, and an “unpredictable” future.
On May 31, as it released the results of its second quarter covering February to April 2022, it said it hoped to convert about SEK20 billion (USD2 billion) of debt and hybrid notes into equity and raise at least SEK9.5 billion in new capital, warning of problems if it could not.
“In the event that the expected burden sharing, debt conversions, and new capital raise are not completed as planned, SAS will not be able to support its existing capital structure and current liquidity levels, and it cannot be ruled out that SAS could become unable to meet its obligations over the longer term as they fall due,” it said.
It added that it had made only “limited progress” so far in implementing its restructuring plan.
The outcome of any planned takeover of SAS may depend on the degree to which the current owners are diluted in a new share issue and how willing they are to contribute the billions that the airline needs, local media speculated.
CEO Anko van der Werff told analysts during an earnings call that there had not been enough progress with the restructuring plan and that the Swedish and Danish governments had so far declined to say if they would invest again, having already paid for a rescue deal in 2020, Reuters reported.
