STOCKHOLM (Reuters) – Airline SAS said on Tuesday it had signed a 3.3 billion Swedish crown ($336 million) three-year revolving credit facility agreement, 90% guaranteed by Sweden and Denmark’s governments, as it looked to beat a path through the coronavirus crisis.
The COVID-19 pandemic and measures to curb its spread have thrown the airline industry into crisis, grounding flights and leaving carriers scrambling to cut costs and staff to cushion the blow.
Many airlines have received or are seeking public backing to see them through the crisis and SAS, part-owned by Sweden and Denmark, had lined up the guarantees from its state owners earlier this year but only now finalised the credit agreement.
“The guaranteed debt package, which has been approved by the European Commission, was implemented in the context of the COVID-19 crisis and is intended to support the airline’s liquidity and prepare for the recovery of its activities,” SAS said in a statement.
Regional rival Norwegian Air <NWC.OL> narrowly avoided bankruptcy this week after a last-minute deal with creditors and shareholders, and SAS is reducing its workforce by about half.
SAS said it would continue its work to cut costs and seek additional support from the Scandinavian countries.
“As part of this we will further our dialogue with the Norwegian government to be able to access up to NOK 1.7 billion of additional state guaranteed funding,” SAS CFO Torbjorn Wist said.
The credit facility was coordinated by SEB. Danske Bank, Nordea, SEB and Swedbank were the mandated lead arrangers.
(Reporting by Johannes Hellstrom and Niklas Pollard; Editing by Andrew Heavens)