The losing bidder was unable to stop SAS from entering into a binding agreement with the winning group. Thus, the airline’s process continues without Apollo Global Management.
SAS CEO Anko van der Werff and chairman Carsten Dilling during a press conference on 3 October, when the bid winners were announced. Photo: TT NEWS AGENCY / X02350Published:
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On Saturday afternoon, SAS writes in a stock exchange announcement that they enter into an investment agreement with Castlelake and Air France-KLM. Lind Invest and the Danish state are also involved in the agreement.
– By entering into this investment agreement, SAS is taking the next step in the chapter 11 process in the USA. The investment is an important milestone in our SAS Forward plan, and shows that our new investors believe in SAS, says managing director Anko van der Werff in a comment to the stock exchange announcement.
The parties have now agreed on an investment in the reconstructed SAS of a total of SEK 13.2 billion, up from SEK 12.9 billion when the non-binding agreement was signed on 3 October.
The new agreement includes $500 million in so-called DIP financing from Castlelake. This financing will replace the existing DIP loan SAS has from the American investment company Apollo Global Management.
The amount corresponds to SEK 5.5 billion.
SAS and Apollo
When SAS applied for so-called bankruptcy protection in the USA last year, the contact with Apollo Global Management had already been established.
In August last year, Apollo committed to a liquidity loan of 700 million dollars to SAS.
However, SAS has only drawn USD 350 million, equivalent to NOK 3.7 billion, from the liquidity loan.
The loan ensured that SAS could operate as normal during the bankruptcy proceedings in the USA.
Until the winning bid was announced, Apollo was the favorite to become SAS’ new major owner.
Sea view
As a result, Apollo will not be able to continue in the competition for shares in the airline.
One week after SAS announced who won the bidding war, Apollo attempted to stop a $3 million payment, which SAS claimed was absolutely necessary to make to the winning group.
This corresponds to almost NOK 33 million.
This payment was critical for the bidders to wish to proceed in negotiations with SAS to sign a final purchase agreement, according to the airline.
This is how the ownership structure will be
Castlelake gets 32 percent of the shares and 55.2 percent of the convertible debt.
The Danish state gets 25.8 percent of the shares and 30 percent of the convertible debt.
Air France-KLM gets 19.9 percent of the shares and 4.8 percent of the convertible debt.
Lind Invest gets 8.6 percent of the shares and 10 percent of the convertible debt.
The remaining approximately 13.6 percent of the shares are distributed between and owned by certain creditors who can receive compensation in shares.
Source: Stock exchange announcement from SAS
Sea view
SAS chairman Carsten Dilling and CEO Anko van der Werff met the press at the head office in Stockholm on 3 October to inform about the process of raising money and the way forward.
In the process, where SAS gets new owners, among other things, the airline will also be delisted from the stock exchange. The shareholders lose everything.
SAS is in a so-called “Chapter 11” process in the USA, where the purpose is to clear up debts. The fresh money will help facilitate the company’s exit from the legal process.
The binding agreement that has now been signed still needs to be approved by the judge in the US Bankruptcy Court in New York.
2023-11-04 17:41:01
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