SAS has successfully secured a substantial investment agreement, totalling 13.2 billion Swedish crowns (US$1.21 billion), through a consortium that includes Air France-KLM, Lind Invest ApS, and the Danish state. This agreement marks a significant milestone in SAS’s restructuring efforts, with Castlelake providing a loan to replace the previous debtor-in-possession financing from Apollo Global Management. Notably, the winning consortium increased its proposed investment by an additional US$25.26 million.
In accordance with the agreement, Castlelake will take a 32% stake in the company, Air France-KLM will hold around 20% and the Danish state will have approximately 26%. These investments will contribute to the reorganisation of SAS, with the total amounting to US$1.16 billion. The airline intends to utilise Castlelake’s US$505.25 million credit agreement to refinance existing loans, enhance liquidity, and facilitate its exit from voluntary restructuring proceedings.
Air France has confirmed the increased financing for the restructuring aid.
Anko van der Werff, SAS’s Chief Executive, expressed, “By entering into this investment agreement, SAS is taking the next step in its Chapter 11 process in the U.S.”
SAS is now actively seeking approval from the U.S. Court for the investment agreement and the new debtor-in-possession financing, aiming to secure this approval as swiftly as possible in November. This development follows SAS’s prior agreement with Apollo Global to raise US$700 million in fresh financing, made in August of the preceding year.
The largest carrier in Scandinavia found itself in a challenging financial situation, prompting its Chapter 11 bankruptcy protection filing in the United States in mid-2022. The company had faced persistent financial struggles due to high operating costs and reduced customer demand resulting from the COVID-pandemic. (£1.00 = US$1.21/SEK13.45).