London Daily

Focus on the big picture.
Saturday, Jun 21, 2025

Airline SAS files for U.S. bankruptcy protection as strike grounds flights

Airline SAS files for U.S. bankruptcy protection as strike grounds flights

Scandinavian airline SAS has filed for bankruptcy protection in the United States to help cut debt, it said on Tuesday, warning strike action by pilots had deepened its financial crisis.
Wage talks between SAS and its pilots collapsed on Monday, triggering a strike that adds to travel chaos across Europe as the peak summer vacation travelling season shifts into full gear for the first time since the COVID-19 pandemic struck.

That accelerated the airline's decision to file for Chapter 11 bankruptcy protection in the United States, its Chief Executive Anko van der Werff said, as it sought breathing space to carry out restructuring plans.

"SAS aims to reach agreements with key stakeholders, restructure the company's debt obligations, reconfigure its aircraft fleet, and emerge with a significant capital injection," it said.

The company said in its court filing the strike would cost it $10 million to $13 million per day, while a Sydbank analyst estimated in a worst-case scenario it could erase up to half of its cash flow in the initial four to five weeks alone.

SAS said discussions with lenders regarding another $700 million of financing were "well advanced".

It said it would continue to serve its customers throughout the bankruptcy process, although the strike is grounding roughly half the airline's flights, affecting some 30,000 passengers per day.

Data from flight tracking website FlightAware showed 232 SAS flights - 77% of those scheduled - had been cancelled on Tuesday, while Oslo's Gardermoen airport, one of SAS' hubs, had the world’s highest cancellation rate on the day.

The airline, whose biggest owners are the Swedish and the Danish states, said the bankruptcy protection filing was aimed at accelerating a restructuring plan announced in February.

It expects to complete the Chapter 11 process in nine to 12 months, it added. SAS shares, which can be traded as normal during the bankruptcy proceedings, were down 14% at 1019 GMT.


COSTS TOO HIGH

Wallenberg Investments, SAS's third biggest shareholder with a 3.4% stake, said it supported the decision and would allow for talks to continue to attain a level of costs and debts that made the airline competitive.

"For decades, SAS has had too-high costs and too-low productivity compared to its rivals," it said.

SAS needs to attract new investors and has said to do that it must slash costs across the company, including for leased planes that stand idle because of closed Russian airspace and a slow recovery in Asia.

Its finance chief Erno Hilden said in the court filing the airline had so far been unable renegotiate lease terms, many of which it said were "significantly above" market rates.

In terms of debt, SAS had three bonds outstanding , , with a total face value of 5.4 billion Swedish crowns ($519 million). They now trade at deeply distressed levels of around one third of face value.

The airline predicted its cash balance of 7.8 billion Swedish crowns was sufficient to meet its business obligations in the near term.

It added however that the strike "has a negative impact on the liquidity and financial position of the company and, if prolonged, such impact could become material".

Sweden's government has said no to injecting more cash into the carrier, while Copenhagen has said it may do so if SAS is able attract new investors.

Nordnet analyst Per Hansen said the application showed SAS needs a fresh start and that it thinks the strike will drag on.

"Chapter 11 protection comes early," he said. "Management and the board want to make it absolutely clear for all stakeholders that the situation is very serious."

($1 = 10.3216 Swedish crowns)
Newsletter

Related Articles

0:00
0:00
Close
Political Turmoil Resurfaces in Belgium Amid Economic Concerns
Fed policymakers divided on timing of interest rate cuts
Trump signals imminent agreement with Harvard University
Inheritance tax referendum alarms Swiss billionaire community
Japan cancels bilateral security meeting amid US defence demands
AI skeptic Emily Bender warns that ‘the emperor has no clothes’
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
UK Home Secretary Apologizes Over Child Grooming Failures
Trump Organization Launches 5G Mobile Network and Golden Handset
Towcester Hosts 2025 English Greyhound Derby Amid Industry Scrutiny
Gary Oldman and David Beckham Knighted in King's Birthday Honours
Over 30,000 Lightning Strikes Recorded Across UK During Overnight Storms
Princess of Wales Returns to Public Duties at Trooping the Colour
Red Arrows Use Sustainable Fuel in Historic Trooping the Colour Flypast
Former Welsh First Minister Addresses Unionist Concerns Over Irish Language
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
France Bars Israeli Arms Companies from Paris Defense Expo
King Charles Leads Tribute to Air India Crash Victims at Trooping the Colour
Jack Pitchford Embarks on 200-Mile Walk to Support Stem Cell Charity
Surrey Hikers Take on Challenge of Climbing 11 Peaks in a Single Day
UK Deploys RAF Jets to Middle East Amid Israel-Iran Tensions
Two Skydivers Die in 'Tragic Accident' at Devon Airfield
Sainsbury's and Morrisons Accused of Displaying Prohibited Tobacco Ads
UK Launches National Inquiry into Grooming Gangs
Families Seek Closure After Air India Crash
Gold Emerges as Global Safe Haven Amid Uncertainty
Trump Reports $57 Million Earnings from Crypto Venture
Trump's Military Parade Sparks Concerns Over Authoritarianism
×