Carrier SAS files for Chapter 11 bankruptcy protection in US
Scandinavian Airlines filed for bankruptcy on Tuesday in the US, stating that the carrier’s existence was in jeopardy due to a day earlier’s 1,000-pilot protest.
According to AP, the decision increases the possibility of travel havoc across Europe as the summer vacation season gets underway.
The Stockholm-based SAS airline group said it had “voluntarily filed for Chapter 11 in the U.S., a legal process for financial restructuring conducted under U.S. federal court supervision.”
In New York, filing for Chapter 11 prevents further civil litigation while the company restructures its finances.
SAS said that its operations and flight schedule will be unaffected by the announcement.
CEO Anko van der Werff said that the pilots’ strike accelerated the move. “I think we have been very clear that this could happen,” he said.
“The important thing is that this is about bankruptcy protection, it is not about a bankruptcy, but it is about financial reconstruction,” van der Werff said.
The carrier said it is “in well-advanced discussions with a number of potential lenders … to support its operations throughout this court-supervised process.”
A rescue plan presented in February was aimed at securing long-term competitiveness. SAS shares dropped more than 9% to 0.56 kronor ($0.05) on Tuesday.
The airline is part-owned by the governments of Sweden and Denmark. In 2018, Norway sold its stake but holds debt in the airline, and has said it might