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TRAVEL NEWS

Struggling Scandinavian carrier SAS gets $700m loan

Ailing Scandinavian airline SAS, which filed for bankruptcy protection in the United States in early July, said Sunday it had secured a 700-million-dollar loan.

An SAS airplane prepares to land at Longyearbyen airport
An SAS airplane prepares to land at Longyearbyen airport on Spitsbergen island in northern Norway. Jonathan NACKSTRAND / AFP

The move follows a crippling 15-day pilot strike, also in July, that cost the carrier between $9 and $12 million a day.

The pilots were protesting against salary cuts demanded by management as part of a restructuring plan aimed at ensuring the survival of the company.

READ ALSO: SAS strike affected 380,000 passengers in July

SAS said it has entered “into a debtor-in-possession (DIP) financing credit agreement for $700 million with funds managed by Apollo Global Management”.

SAS had filed for Chapter 11 bankruptcy protection in the United States and said the “DIP financing, along with cash generated from the company’s ongoing operations, enables SAS to continue meeting its obligations throughout the chapter 11 process”.

“With this financing, we will have a strong financial position to continue supporting our ongoing operations throughout our voluntary restructuring process in the US,” SAS board chairman Carsten Dilling said.

SAS management announced in February the savings plan to cut costs by 7.5 billion Swedish kronor ($700 million), dubbed “SAS Forward”, which was supplemented in June by a plan to increase capital by nearly one billion euros ($1.04 billion).

Denmark and Sweden are the biggest shareholders with 21.8 percent each.

“We can now focus entirely on accelerating the implementation our SAS FORWARD plan, and to continue our more than 75-year legacy of being the leading airline in Scandinavia.”

SAS employs around 7,000 people, mainly in Denmark, Norway and Sweden. It has suffered a string of losses since the start of the coronavirus pandemic in early 2020.

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TRAVEL NEWS

New rail service planned through Norway, Sweden and Denmark to Hamburg

Plans for a new rail service running from Oslo and stopping in Gothenburg, Malmö and Copenhagen before arriving in Hamburg are in the works, Swedish state-owned rail operator SJ has said.

New rail service planned through Norway, Sweden and Denmark to Hamburg

Sweden’s state-owned SJ, along with Denmark’s DSB and DB of Germany, plans to offer a new international train line which runs between the Norwegian capital Oslo and Hamburg in northern Germany. 

The planned route would run daily, departing from Oslo at 8am before making stops in Gothenburg, Malmö and Copenhagen and arriving in Hamburg at 7pm. A service departing Hamburg and terminating in Gothenburg is also planned.

The 11 hour service would be quicker than the equivalent journey using either a car and ferry connection or existing train services. 

The planned service will enter into operation in 2027. Petter Essén, head of SJ’s vehicle and traffic programme, said the route made sense as it would connect a long stretch which doesn’t have continuous train traffic. 

“Today, there is a great deal of flying between Copenhagen and Oslo and between Oslo and Gothenburg, routes that would be fine by train,” Essén told Swedish newspaper Dagens Nyheter

Currently, the only direct trains from the Norwegian capital to other countries are services to Gothenburg and Stockholm. 

The European Commission has selected the potential line as one of ten pilot projects that will receive support. This does not mean it will receive direct funding from the EU, but it will get backing on regulations and logistics, Essén explained.

“You can get help with various regulations and the process of getting all vehicles approved in all countries,” he said.

Generally, many Swedish and Norwegian trains can only operate within Sweden and Norway, while the majority of Danish and German trains are not cleared to run in Sweden in Norway. 

The Snälltåget line between Stockholm and Berlin has also been selected to receive support from the European Commission. 

SJ also announced plans to increase the number of trains between Gothenburg and Malmö to ten per day and offer the Gothenburg-Copenhagen service all year round. It said that these plans could come to fruition by 2026 or 2027. 

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