Airline SAS collided with astonishing pilots due to US bankruptcy record

  • Airlines in Chapter 11 in the United States
  • The indictment comes after the pilots’ strike began on Monday.
  • The strike has caused an immediate loss, according to the company.
  • Attempts to accuse employees of “under contempt” – union
  • Approximately halfway off the airline flights

Stockholm, July 5 (IANS) Scandinavian Airlines (SSS) has demanded that the United States seek bankruptcy protection in order to reduce debt and put pressure on offending pilots. Shares are down 10 percent.

As the summer shift shifts to full gear, payroll talks between the SS and its pilots fell on Monday, sparking a strike that has increased travel across Europe.

Anko van der Verff, chief executive, said the strike had accelerated its decision to register in Chapter 11. However, SSS Danish pilots said that the negotiator had been in the process for months, and that he was trying to hold the strikers accountable.

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The airline, whose main owners are Swedish and Danish taxpayers, said the strike “will have a negative impact on the company’s finances and if extended it could have a material impact.”

The strike will cost between $ 10 million and $ 13 million a day, the company told the court. Sidbank analysts estimate that in the worst case scenario, in just the first four to five weeks, it could cancel up to half of the cash flow.

Sidbank analyst Jacob Pederson says:

“On the other hand, the question of Chapter 11 shows how serious the SAS situation is.”

Experts say the entry into Chapter 11 will make it easier for the company to lay off employees.

According to Martin Lindgren, chairman of the Swedish Pilots’ Association, members see the airline as a “rebuilding” of the airline.

“This will not affect the strike or our agreement,” he said.

The airline said the US bankruptcy protection record was intended to speed up the restructuring plan, which was announced in February.

“SSS aims to reach an agreement with key stakeholders, restructure the company’s debt obligations, restructure the aircraft and use significant capital injections,” he said.

Talks to creditors.

SSS Airbus A321 and A320 Neo planes land on asphalt after Scandinavian pilots strike in Castrus, Denmark on July 4, 2022.

SAS said talks with lenders about another $ 700 million in financing were “very good.”

He said the strike was halting flights and injuring 30,000 passengers a day.

According to the flight tracking website, 232 SAS flights – 77% of the planned – were canceled on Tuesday, with Oslo Gardermoen Airport, one of the SAS centers, having the highest cancellation rate in the world.

SAS added that it expects to complete the Chapter 11 process in nine to 12 months. SAS shares may be traded as normal during the bankruptcy process.

Wallaceberg Investments, the third largest shareholder in SSS with a 3.4% stake, said it would support the decision and allow talks to continue to make the airline more competitive.

“For decades, SAS has a very high cost and very low productivity compared to its competitors,” he said.

SSS says it needs to attract new investors and reduce costs at the company, including rented aircraft in the closed Russian airspace and in Asia. Read more

The chief financial officer, Erno Hilden, told the airline that he had not been able to renegotiate the lease and that most of it was too high.

SAS had three best bonds, with a total face value of 5.4 billion Swedish crowns ($ 519 million). They are now trading up to one-third of the face value.

The airline recently estimated that 7.8 billion Swedish crowns would be enough to meet business obligations.

The Swedish government has said it should not invest more in the transport, while Copenhagen says it will do so if SAS can attract new investors.

Nordnet analyst Per Hansen said the US application SAS needed a fresh start and that the strike would continue. “The management and the board want to make it very clear to all stakeholders that the situation is very serious.”

($ 1 = 10,3216 Swedish crowns)

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Additional writing by Johan Ahlander in Stockholm, Isi Lehto in Helsinki, Victoria Clesty in Oslo, Agata Ribska in Gadansk, Jamie in Sydney and Karin Stroecker in London, by Niklas Pollard; Edited by Matt Scuffham, Jan Harvey and Emelia Sithole-Matarise

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