Air France-KLM Buys SAS Shares and Approaches Scandinavian Market

Air France-KLM is set to acquire a 19.9 percent equity stake in the Scandinavian airline SAS. SAS recently revealed that it is assessing multiple investment offers, as the company faces financial difficulties and is currently undergoing Chapter 11 bankruptcy protection proceedings in the United States.

In addition to Air France-KLM’s investment, the Danish government is also injecting funds into SAS. Together with other investors, this collective effort amounts to nearly $1.2 billion, with Air France-KLM contributing $144.5 million.

Established in 1964, SAS is planning to depart from the Star Alliance airline group and eventually join SkyTeam, of which Air France-KLM is a member.

Air France-KLM’s involvement goes beyond financial support, as they are forging a partnership with SAS to bolster their presence in the Scandinavian market. Ben Smith, CEO of the French-Dutch conglomerate, described this as a significant day for both SAS and Air France-KLM, expressing his satisfaction at being part of the financing consortium selected by the SAS board.

SAS has been severely impacted by the COVID-19 pandemic and is grappling with substantial debts. The capital injection still awaits approval from various authorities, including the European Commission and courts in the United States and Sweden.

Following approval, Castlelake is poised to acquire a stake of roughly 32 percent in SAS, while Lind Invest will hold 8.6 percent. The Danish state will maintain ownership of 26 percent of the airline.

SAS Chairman Carsten Dilling emphasized that this move is a crucial step in the company’s transformation process. Furthermore, SAS’ stock exchange listing in Stockholm is expected to be delisted.

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