Scandinavian airline SAS has voluntarily filed for chapter 11 bankruptcy protection in the U.S., to try and secure time and flexibility to reorganize its capital structure, reduce costs, and complete a financial restructuring under the supervision of the U.S. court system.
SAS expects to complete its court-supervised process in the U.S. in 9-12 months.
The airline wants to reach agreements with key stakeholders, restructure the company’s debt obligations, reconfigure its aircraft fleet, and emerge with a significant capital injection, while continuing to run the airline.
It said operations and flight schedules would remain unaffected by the chapter 11 filing. “SAS will continue to serve its customers as normal, although the strike by SAS Scandinavia pilots’ unions will impact the flight schedule,” the airline said.
On Monday, SAS pilots decided to go on strike affecting 50 percent of flights and 30,000 passengers per day.
The debt-ridden airline has been struggling to improve its cost structure and financial position for the past few months.
While progress has been made, the ongoing strike has made an already challenging situation even tougher, said Anko van der Werff, president and CEO.
“The chapter 11 process gives us legal tools to accelerate our transformation, while being able to continue to operate business as usual. We will continue to build back the network connectivity, products and service our customers expect, and we will continue to do so throughout this process and beyond,” he said.