Scandinavian airline SAS has filed for so-called Chapter 11 chapter proceedings in the USA on Tuesday, as part of a restructuring plan, a day after pilots walked out on strike.
So as “to proceed with the implementation of key parts of (its enterprise transformation plan), SAS and sure of its subsidiaries have voluntarily filed for Chapter 11” within the US, the troubled provider stated in an announcement.
Within the US, chapter 11 is a mechanism permitting an organization to restructure its money owed beneath court docket supervision.
SAS stated its “operations and flight schedule are unaffected by the Chapter 11 submitting, and SAS will proceed to serve its clients as regular,” whereas noting that the strike launched on Monday by Scandinavian pilot unions would proceed to impression operations.
“The continuing strike has made an already difficult scenario even more durable. The Chapter 11 course of provides us authorized instruments to speed up our transformation, whereas with the ability to proceed to function the enterprise as normal,” Chief Government Anko van der Werff stated in an announcement.
Pilots walked out on Monday after negotiations between the unions and the corporate broke down.
The pilots are protesting in opposition to wage cuts demanded by administration as a part of a restructuring plan aimed toward guaranteeing the survival of the corporate, which has suffered a string of losses for the reason that begin of the coronavirus pandemic in early 2020.
On Monday, SAS stated that the strike “is estimated to result in the cancellation of roughly 50 % of all scheduled SAS flights,” impacting round 30,000 passengers a day.
SAS administration introduced in February the financial savings plan, dubbed “SAS Ahead”, which was supplemented in June by a plan to extend capital by almost one billion euros ($1.04 billion).
Denmark and Sweden are the largest shareholders with 21.8 % every.
Denmark stated in June it was prepared to extend its stake to 30 %. Sweden has refused to supply recent funds, however is keen to show debt into capital.
Norwaywhich left SAS in 2018, has stated it is able to return to the airline, however solely by changing debt into fairness.
The strike at SAS comes because the summer season is shaping as much as be troublesome for European airways and airports, confronted with workers shortages affecting site visitors.
After widespread job losses linked to Covid-19, airways and airports are struggling to recruit new workers in lots of international locations.
