By Dominic Chopping


STOCKHOLM--SAS said it will file an amended Chapter 11 plan of reorganization with the U.S. Bankruptcy Court detailing the expected recoveries for its general unsecured creditors.

The Scandinavian airline said that up to $325 million is expected to be allocated to general unsecured creditors in the plan, consisting of up to $250 million in cash and $75 million in new equity.

The $75 million in new equity will be allocated to unsecured creditors including the Danish, Norwegian, and Swedish states, and some creditors that it expects to have a continued relationship with--such as aircraft lessors, pilot unions, and key suppliers--it said.

Other creditors, including holders of the listed commercial hybrid bonds and some creditors holding smaller claims, are expected to receive a cash-only recovery.

Holders of the company's listed commercial hybrid bonds will receive an initial cash recovery corresponding to between 6.9% and 9.4% of the nominal value of their claims after the airline emerges from the Chapter 11 process, with the possibility of receiving an additional cash distribution of between 13.1% and 15.6%, it added.

The airline reiterated that there will be no recovery for its subordinated creditors and no value for existing shareholders, with all of its shares and listed commercial hybrid bonds to be cancelled, redeemed and delisted.

SAS filed for Chapter 11 bankruptcy in 2022 as it worked to push through a comprehensive financial restructuring to cut costs and raise capital under the supervision of the U.S. court system. It recently struck a deal with Castlelake, Air France-KLM, Lind Invest and the Danish state that will see the consortium pump $1.2 billion into the carrier for majority control.

SAS expects to emerge from the Chapter 11 process around the end of the first half of 2024.


Write to Dominic Chopping at dominic.chopping@wsj.com


(END) Dow Jones Newswires

02-05-24 0609ET