COPENHAGEN, Denmark — Scandinavian Airways on Tuesday filed for chapter in the USA, warning a walkout by 1,000 pilots a day earlier had put the way forward for the service in danger.
The transfer provides to the probability of journey chaos throughout Europe because the summer season trip interval begins.
The Stockholm-based SAS airline group stated it had “voluntarily filed for Chapter 11 within the U.S., a authorized course of for monetary restructuring performed underneath U.S. federal court docket supervision.”
Submitting for Chapter 11 in New York places civil litigation on maintain whereas the enterprise reorganizes its funds.
SAS stated that its operations and flight schedule will likely be unaffected by the announcement.
CEO Anko van der Werff stated that the pilots’ strike accelerated the transfer. “I feel we now have been very clear that this might occur,” he stated.
“The essential factor is that that is about chapter safety, it isn’t a couple of chapter, however it’s about monetary reconstruction,” van der Werff stated.
The service stated it’s “in nicely superior discussions with a variety of potential lenders … to help its operations all through this court-supervised course of.”
A rescue plan offered in February was aimed toward securing long-term competitiveness. SAS shares dropped greater than 9% to 0.56 kronor ($0.05) on Tuesday.
The pilots reacted strongly to the information of the Chapter 11 submitting. Roger Klokset, head of the SAS pilots union, stated the group “had stretched negotiations and mediation from November final 12 months till the day earlier than the applying, with out ever having the intention of coming into into an settlement with the SAS pilots.”
The pilots in Denmark, Sweden and Norway walked out on Monday, citing insufficient pay and dealing circumstances and expressing dissatisfaction with the choice by the service to rent new pilots to fill vacancies at its subsidiary airways, SAS Hyperlink and SAS Join, reasonably than rehire former pilots who have been laid off because of the pandemic.
Van der Werff stated the strike was “devastating for SAS and places the corporate’s future along with the roles of hundreds of colleagues at stake.”
The walkout is estimated to result in the cancellation of roughly 50% of all scheduled SAS flights and affect round 30,000 passengers per day. Flights operated by SAS Hyperlink, SAS Join and SAS’ exterior companions are usually not affected.
The airline is part-owned by the governments of Sweden and Denmark. In 2018, Norway bought its stake however holds debt within the airline, and has stated it may be keen to transform that into fairness.
“Proper now, it’s troublesome to evaluate the importance of the Chapter 11 request for length of the pilot strike,” chief analyst Jacob Pedersen of Denmark’s Sydbank stated. Nevertheless, “it’s uncertain whether or not it would deliver (the pilots) again to the negotiating desk.”
The transfer by SAS was “not stunning” however got here “sooner than we anticipated,” Pedersen stated in an evaluation. “Though SAS is now underneath chapter safety, it isn’t a seaside vacation for the corporate.”
———
Jari Tanner in Helsinki contributed to this report.
