SAS enters into investment agreement and replacement facility for existing DIP financing

SAS announced (04-Nov-2023) it entered into an investment agreement with the winning bidder consortium in its exit financing solicitation process, consisting of Castlelake, Air France-KLM and Lind Invest, together with the Danish state. As part of the agreed transaction structure, SAS has also entered into a new debtor-in-possession (DIP) financing credit agreement for USD500 million with Castlelake to, among other things, refinance SAS' existing DIP term loan, increase liquidity, and support SAS' path to exit from its voluntary restructuring proceedings. As previously reported by CAPA, the transaction structure agreed on in Oct-2023 included a USD1175 million investment. The consortium has now increased its proposed investment by USD25 million to USD1200 million, which includes USD475 million in new unlisted equity and USD725 million in secured convertible debt, and a USD500 million refinancing by Castlelake of SAS' DIP term loan. The agreed transaction will need to be approved in connection with the confirmation of the Chapter 11 Plan, for which SAS currently aims to receive approval from the US court in early 2024. This is to be followed by obtaining regulatory approvals and the implementation of a Swedish company reorganisation at the SAS AB level, likely to be filed during 2024. CEO Anko Van der Werff commented: "By entering into this investment agreement, SAS is taking the next step in its Chapter 11 process in the US. The investment is a key milestone in our SAS FORWARD plan, and it shows that our new investors believe in SAS and our potential to remain at the forefront of the airline industry for years to come". [more - original PR]