SAS announces that it has entered into an investment agreement with the winning
bidder consortium in its exit financing solicitation process, consisting of
Castlelake, L.P., on behalf of certain funds or affiliates ("Castlelake"), Air
France-KLM S.A. ("Air France-KLM") and Lind Invest ApS ("Lind Invest"), together
with the Danish state (collectively, the "Investors"). As part of the agreed
transaction structure, SAS has also entered into a new debtor-in-possession
("DIP") financing credit agreement for USD 500 million (SEK 5.5 billion)[1] with
Castlelake (the "New DIP Financing") to, among other things, refinance SAS'
existing DIP term loan, increase liquidity, and support SAS' path to exit from
its voluntary restructuring proceedings. The agreements are subject to review
and approval by the U.S. Bankruptcy Court for the Southern District of New York
(the "U.S. Court").
On October 3, 2023, SAS announced that it had selected the Investors as the
winning bidder consortium in its exit financing solicitation process, and that
the parties were in agreement on a transaction structure including a total
investment in the reorganized SAS corresponding to USD 1,175 million (SEK 12.925
billion). The winning bidder consortium has now increased its proposed
investment by USD 25 million (SEK 275 million) to a total of USD 1,200 million
(SEK 13.2 billion), which includes USD 475 million (SEK 5.225 billion) in new
unlisted equity and USD 725 million (SEK 7.975 billion) in secured convertible
debt, as well as Castlelake providing a USD 500 million (SEK 5.5 billion)
facility to refinance SAS' Existing DIP Financing (as defined below).
The investment agreement entered into by SAS and the Investors includes the
final terms of the Investors' equity investment, as well as the key terms for
the secured convertible debt and SAS' chapter 11 plan of reorganization (the
"Chapter 11 Plan"). The agreed investment structure, which (save for the
increased convertible debt amount) is consistent with the key terms set out in
the press release announced by SAS on October 3, 2023, will result in a
shareholder structure post-reorganization (based on total equity, but pre
-conversion of the convertible debt) where:
(i) Castlelake holds approximately 32.0% of the equity and 55.2% of the
convertible debt