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SAS

SAS sells 49 percent stake in Estonian Air

SAS has reached an agreement with the Estonian government to sell its 49 percent stake in Estonian Air.

SAS sells 49 percent stake in Estonian Air

“Since 2003, SAS has held a 49 percent interest in the airline. According to the Core SAS strategy with focus on the Nordic home market, this stake has been set out for divestment,” said Sture Stølen, vice president and head of SAS Group investor relations, in a statement.

The agreement with the Estonian government involves SAS divesting its stake. The Estonian government will provide about 205 million kronor ($25.89 million) of new capital in a new rights issue. In return, SAS will convert about 20 million kronor it currently holds in loans into equity.

After the rights issue, the Estonian government will hold 90 percent of Estonian Air, with SAS holding the balance. SAS will also remain the lender of about 70 million kronor in loans with a maturity in 2014.

The transaction is neutral to the profit and liquidity of the SAS Group. Estonian Air has an option to buy out SAS’ remaining stake and SAS has the option to sell its stake at fair market value in four years.

SAS will continue its commercial cooperation with Estonian Air, Estonia’s national carrier. The airline was founded in 1991 and is also partially owned by investment bank Cresco.

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SAS

SAS announces reduced loss and pins hopes on summer flights

Scandinavian airline SAS narrowed its losses in the second quarter, the company said Thursday, as it set its hopes on an easing of coronavirus restrictions this summer.

SAS announces reduced loss and pins hopes on summer flights
A SAS aircraft taking off in Paris. Photo: Charles Platiau/Reuters/Ritzau Scanpix

The earnings report came a day after the governments of Sweden and Denmark announced another round of aid to the ailing carrier.

From February to April, SAS booked a net loss of 2.43 billion Swedish kronor ($292 million, 240 million euros) — 30 percent smaller than in the second quarter last year.

The company also reported an improved operating profit “for the first time since the pandemic’s outbreak, both year-on-year and compared with the previous quarter,” pointing to its cost cutting efforts.

However, the number of passengers in the period declined by 140,000 compared to the first quarter, to 857,000.

This caused revenue to fall to 1.93 billion kronor, a 15 percent drop from the preceding quarter and 63 percent from a year earlier.

“The increase in vaccination rates provides some hope for the relaxation of restrictions, and an increase in demand ahead of the important summer season,” chief executive Karl Sandlund said in a statement.

However, the CEO also noted that “many customers are now increasingly choosing to book their tickets much closer to their travel dates, which makes it difficult to predict demand during the summer.”

SAS also said it expected claims from passengers of up to 150 million kronor after a European court ruled in March that customers should be compensated over disruptions due to a pilots’ strike in 2019.

After cutting 5,000 jobs last year — representing 40 percent of its workforce — SAS announced Wednesday an additional credit line of three billion kronor from the Danish and Swedish governments, its main shareholders, to get through the crisis.

The airline received a similar loan and a capital increase last year.

READ ALSO: Virus-stricken airline SAS secures new public loan from Denmark and Sweden

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