A ONCE-STRUGGLING airline has reached a tentative $1.2billion deal to exit bankruptcy.
SAS, a Scandinavian airline company, filed for Chapter 11 bankruptcy in July 2022.
1
The company is receiving an influx of cash from several public and private entities.
Air France-KLM, a France-based airline company, is investing $145million and will take minority stake of SAS.
If the deal is approved, SAS will join the SkyTeam Alliance with Air France.
“This is terrific news,” SAS’s CEO Anko Van der Werff said to Airline Weekly.
“You can take Sweden out of SAS, but you cannot take SAS out of Sweden.”
Executives at the airline nearly confirmed that it would retain flights to Oslo and Stockholm in the new deal, calling the airports “important hubs.”
They also called Copenhagen a “very important hub.”
The decision to join forces with Air France-KLM will change the way customers interact with European airlines.
SAS reported losing $398million between November 2022 to August 2023 as it entered bankruptcy.
The airline has since found its footing in the market, reaching profitability in the last quarter.
SAS’s place in Air France’s lineup could spell huge changes in the European airline market.
AIRLINE CHANGES
European airliners have gone through a massive transformation in the past several months.
Lufthansa put in a claim to purchase Italy’s ITA Airways.
International Airline Group also put in a claim to take over part of Spain’s Air Europa.
As the giant airlines in Europe continued to consolidate power, Lufthansa grew more prominent in Northern European air travel.
Air France’s potential acquisition could make the market more competitive and drive down ticket prices for travelers.
MORE AIRLINE BANKRUPTCIES
SAS was one of three major airlines with huge bankruptcy deadlines in September.
Airlines grappled with growing debt as customers ceased traveling in 2020.
Despite record profits after pandemic lockdowns, some companies have struggled to claw their way through incurred debt payments.
IAero, a North Carolina-based company with a fleet of 39 Boeing 737s, filed for bankruptcy.
Florida-based Western Global Airline also started bankruptcy proceedings after declaring liabilities between $500million and $1billion.
Western Global predicted financial struggle in a July press statement, saying: “WGA, its CEO and Founder Jim Neff, and its management team are committed to acting in the best interests of the Company and its stakeholders.
“After 10 years of profitable operations and successful growth, the company is currently navigating financial challenges driven by unforeseen industry-wide factors, including the conflict in Ukraine, the weakened global economy and particularly air cargo demand, spiraling costs, and the recurrence of COVID-19 pandemic in China, which disproportionately impacted WGA and its customers.”
The U.S. Sun reports on other bankruptcies – here are some companies that experts predict may have to file Chapter 11.
Also, here are all of the brands that went bankrupt in 2023.