Late on Tuesday afternoon, the two senior men of the SAS were ready to reveal a secret well-kept to the last.
Chairman Carsten Dilling and CEO Anko van der Werf met a large press corps at the head office in Stockholm and were able to talk about the status of the search for “at least” NOK 9.5 billion of new shares.
in the message It turns out that the following are the new major owners of SAS:
- Air France-KLM, with 19.9% of the company.
- The Danish state by 25.8 percent.
- Castellec, an international fund manager, with 32 percent.
- Lind Invest, Danish Family officeby 8.6 percent.
- The remaining 13.6% will likely be owned by creditors who will be able to convert debt into equity.
The four new main owners enter the company with $1.175 billion in new money, which equates to a meager 13 billion Swedish krona (and about the same in Norwegian).
– Remember, our target was just over nine billion Swedish krona, says Chairman Carsten Dilling from the stage.
Other key elements of the plan are:
- SAS will go public in all Scandinavian capitals.
- Today’s shareholders lose everything.
- The company leaves Star Alliance.
The Daling says the final agreement was signed just minutes before the press conference held on Tuesday.
– By securing this capital, we will have secured one of the pillars of our plan, SAS Forward, and it will also help us emerge from the Chapter 11 process in the United States, referring to the extensive restructuring process underway in the United States. The law gives the company protection from bankruptcy.
Eurobonus can evaporate
“This will ensure that we are at the forefront of aviation in the coming years,” says a confident van der Werff.
According to him, SAS’s Eurobonus loyalty program will not end anytime soon, but it may end soon as the ownership change begins.
– We will also seek to benefit from and increase collaboration with Air France-KLM and other airlines within that group, says the SAS president.
While the Danish state has expressed its desire to secure international traffic at Kastrup Airport, which indirectly affects the Danish economy significantly, the interests of Air France-KLM are more industrial. New financial partners are unknown in Norway.
Castlelake has a British foothold and aviation as one of its three specialist areas. Founded in 2005, the manager bets on property and “special financial situations” as well. Castlelake has NOK 240 billion under management, and is getting a financial partner in Danish investor Henrik Lind. At the end of last year, Hans Linde Invest had a portfolio worth NOK 14.3 billion.
Separation from the Star Alliance
The new ownership constellation also means that SAS breaks away from Star Alliance and switches to the rival alliance Skyteam.
Meanwhile, SAS is proposed to be taken off the stock exchange as a separate listed company. This is expected to happen in the second quarter of 2024. Therefore, today’s shareholders will also likely lose all of their value when the company emerges from the bankruptcy process.
It was announced on Tuesday that unsecured creditors are now prepared to recover between 5 and 20 percent of the amounts owed. This could mean huge losses for the Norwegian state. Chairman Dilling says the size of the payment can be affected by the additional steps the deal must go through.
Familiar with Air France-KLM
The Dutch segment of Air France-KLM is particularly well known to SAS management today.
- Today’s SAS CEO, Anko van der Werff, was KLM’s regional director for Sweden, Finland and the Baltics for several years early in his career, before his career took him into management at Qatar Airways and Aeromexico, among others. In the fall of 2021, he took over as the new CEO of SAS after his predecessor, Rikard Gustafsson.
- Just a month ago, another Dutchman joined the management of SAS. Introduced as the new Commercial Director, Paul Verhagen also has experience as Regional Director for Air France-KLM in Norway, Finland and the Baltics. Verhagen also later worked with van der Werff in the management of Aeroméxico.
When asked by DN whether Van der Werf felt an extra sense of pride in merging his home country’s airline with SAS, he replied:
– In this industry, it’s not about the passport you have, it’s something much bigger. This deal will enable us to be part of something bigger.
Apollo as a lender
Through the process in the courts, since August last year, SAS has obtained expensive loan financing from the American fund Apollo Global Management – a bridge loan of more than NOK 3.5 billion. Apollo has also been linked several times with SAS as a potential future major owner. The fund had two alternative paths on the equity side: It could convert the billion-dollar debt into equity, and perhaps come in with additional new capital on top of that.
In contrast, it now appears that Apollo will not continue as owner of SAS. They participated as a bidder, but did not win the bidding process.
Asked why Apollo does not convert debt into equity, Anko van der Werf says:
– Here we have a very precise stock race, set up so that the best bid wins. There should be no doubt about that. Beyond that, we will not comment on what was said in the negotiations.
It is also clear that the bridge loan from Apollo will be refinanced into a new and larger bridge loan of approximately NOK five billion.
In addition, the Danish state has been clear in its desire to own between 21 and 30 percent of the “new” SAS. Tuesday around lunch can Danish TV 2 He told that the Danish state is among the major owners investing new money. They will own 25.8 percent of the new SAS.
Seedbank analyst Jacob Pedersen has repeatedly noted that today’s stockholders will lose all, or almost all, of their value in connection with the bankruptcy.(conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links that lead directly to our pages. No copying or other use of all or part of the Content may be permitted except with written permission or as permitted by law. For more terms see here.
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