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SAS and pilot unions continue negotiations into weekend

The Scandinavian airline SAS and unions representing striking pilots were still continuing talks on Saturday, with an agreement by the end of the day deemed "unlikely."

Published: 16 July 2022 17:23 CEST
Updated: 16 July 2022 21:44 CEST

SAS and pilot unions continue negotiations into weekend

A passenger walks at Oslo airport. Photo by CORNELIUS POPPE / NTB SCANPIX / AFP

The negotiations, which are being held at the Confederation of Swedish Enterprise in Stockholm, started on Wednesday and have included 15-hour days.

On Saturday morning, chief negotiator for SAS Marianne Hernæs told news agency TT that they would press ahead quickly but she doubted that an agreement would be reached by the end of the day.

The Norwegian mediator Mats Wilhelm Ruland, said there was a “sincere will to resolve this”. When asked if he had booked a flight home to Norway on Saturday night, he replied “no” with a laugh.

When Friday’s negotiations finished for the day, Ruland announced “progress” and said he was “optimistic” about Saturday’s continued talks.

About 1000 SAS pilots from Denmark, Norway and Sweden have been on strike since Monday 4th July.

The pilots walked out last week after negotiations broke down. They are protesting against salary cuts demanded by management as part of a restructuring plan aimed at ensuring the survival of the company, and the firm’s decision not to re-hire pilots laid off during the Covid-19 pandemic.

The strike, which is now in its 13th day, has cost SAS up to 130m kronor a day, with 2,550 flights cancelled by Thursday, affecting 270,000 passengers.

READ MORE: What are your rights if flights are delayed or cancelled?

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Scandinavia's SAS airline shares tumble amid reports of delisting

Danish newspaper Berlingske cited multiple unnamed sources in a report late on Tuesday, saying plans for a delisting of the company were so far gone that it would be “very surprising” if it were still on a stock exchange by the autumn.

That would leave the airline under the ownership of US capital fund Apollo and the Danish state, with 70 and 30 percent stakes respectively, the newspaper said.

Apollo lent the company $700 million last year, in a deal which would also allow it to convert the company’s debt into shares.

SAS is primarily listed on the Stockholm Stock Exchange, and also appears on exchanges in Oslo and Copenhagen. If delisted, the Swedish state — which like the Danish state currently owns 21.8 percent of the company — would exit as an owner, having previously indicated that it did not wish to reinvest.

In the wake of the media report, shares on the Stockholm Stock Exchange dropped from 0.35 kronor to a low of 0.24 kronor.

Commenting on the article, SAS said it had “initiated a process to raise capital,” as part of its restructuring process.

“We do not want to speculate on the outcome of the capital raising process and it is currently not possible to know whether the investors who ultimately invest in SAS prefer a listed or unlisted company,” Anna Sandell, the head of media relations at SAS, told AFP in an email.

In February, the crisis-hit airline posted a net loss of 2.7 billion kronor ($260 million) from November to January, despite a boost in passenger numbers. SAS filed for Chapter 11 bankruptcy proceedings in the United States in July last year — a move allowing a company to restructure its debts under court supervision.

The airline has said it hopes to complete the process by the “second half of 2023,” and projected that it would see positive earnings before taxes by its 2024 fiscal year. According to its latest quarterly report, SAS employs about 7,500 people, mainly in Denmark, Sweden and Norway.

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