In a startling turn of events, Scandinavian airline SAS experienced a dizzying 95% freefall in its shares as the markets unfurled on Wednesday. The turbulence was triggered by the company’s revelation late on Tuesday about an impending restructuring deal that would culminate in its delisting from exchanges.
While the initial shockwaves were seismic, there’s been a partial recovery since, with shares now down by roughly 83% as of 7:26 a.m. ET.
The nosedive was set in motion when SAS disclosed a restructuring plan that charts a new course for the airline. U.S. investment firm Castlelake and aviation heavyweight Air France-KLM are set to take the reins as major shareholders, collectively holding about 32% and 20% of the company. Meanwhile, the Danish government is poised to secure approximately 26% of SAS, with Danish investment firm Lind Invest staking a claim of 8.6%, SAS reports.
The sweeping changes include the cancellation, redemption, and delisting of all SAS AB’s common shares and listed commercial hybrid bonds, according to a statement from SAS on Tuesday. This transformative process is anticipated to unfold in the second quarter of 2024.
This dramatic development unfolds against a backdrop of years marked by financial turbulence for SAS. The airline, grappling with the fallout from pilot strikes and a slump in demand in the wake of the Covid-19 pandemic, sought refuge in bankruptcy protection in the U.S. back in July 2022. Now, the company is navigating the winds of change as it charts a new flight path under the wings of Castlelake, Air France-KLM, and other stakeholders. The fate of SAS hangs in the balance as it embarks on this transformative journey.
