Sudden Spanair shut-down strands passengers, has implications for SAS
SAS Group has been forced to write down SEK 1.7 billion (€200 million), which is approximately the amount of its remaining exposure to Spanair following the divestment of most of its ownership in 2009. More than 22,000 passengers were stranded over the weekend when Spanair suddenly declared bankruptcy, cancelling all flights at half an hour’s notice. Passengers were stranded mostly in Spain but also hundreds of people were left stranded at airports in places as far afield as Mali, Gambia and Morocco. Qatar Airways was in takeover talks with Spanair, but discussions ended inconclusively.
The bankruptcy forced SAS to issue a profit warning. It said in a statement: “SAS has decided to make a write down of the outstanding debt and receivables on Spanair of approximately MEUR 165, as well as reserve MEUR 28 in guarantees and costs due to the bankruptcy. SAS ownership in Spanair is currently 10.9%, but the value of these shares has already been written down and are booked at 0 value. The write down will affect the SAS Group’s result as a non-recurring item and equity negatively by SEK 1.7 billion in total. […] SAS Group will follow customary procedures as a creditor in the upcoming bankruptcy process.”
SAS added that it had a financial preparedness of SEK 10.6 billion, and the event would have a limited effect on SAS liquidity.
TTG / RTE