Scandinavian operator SAS has secured European Commission approval for a restructuring aid package worth up to €1.3 billion ($1.4 billion) intended to support the company’s efforts to achieve long-term sustainability.
SAS has been undergoing a restructuring programme – known as ‘SAS Forward’ – while under US Chapter 11 bankruptcy protection.
The restructuring includes contributions from both the Swedish and Danish governments.
According to the Commission, the aid is proportionate – with investors in SAS providing their own contribution – and will help avoid “hardship and market failure” while tackling the main reasons for SAS’s financial problems.
SAS’s commitments to reduce its fleet, divest assets and release a “significant” number of slots, it adds, means distortion of competition is limited.
It concludes that the Danish and Swedish measures are “in line” with European Union state-aid rules.
SAS says the clearance is “another important step forward” in the carrier’s transformation plan, although it adds that its Chapter 11 restructuring remains subject to various conditions.
