Air France-KLM buys 19.9% shares in struggling competitor SAS
Air France-KLM is taking a 19.9 percent equity stake in the ailing Scandinavian airline SAS. The
SAS recently announced that it is considering several offers from potential investors. The company is experiencing financial problems and is involved in a Chapter 11 procedure for bankruptcy protection in the United States.
The Danish government also pushed money into SAS. Together with Air France-KLM and the investors, it involves a total amount of almost 1.2 billion dollars. Air France-KLM will pay 144.5 million of this amount.
Air France-KLM is also entering into a partnership with SAS to strengthen its position in the Scandinavian market. CEO Ben Smith of the French-Dutch group spoke of an important day for SAS and Air France-KLM and said he was pleased to be part of the financing consortium selected by the SAS board.
SAS was hit very hard by the coronavirus pandemic and is burdened by sky-high debts. The authorities, including the European Commission and courts in the United States and Sweden, must still approve the capital injection.
Castlelake will then take a stake of approximately 32 percent in SAS, and Lind Invest will own 8.6 percent. The Danish state owns 26 percent of the company.
SAS chairman Carsten Dilling said this was an essential step in the company's transformation process. SAS’ stock exchange listing in Stockholm will be delisted, Dilling said.
Founded in 1964, SAS will also withdraw from the Star Alliance airline and eventually join SkyTeam, of which Air France-KLM is a member.
Reporting by ANP