The European Commission has today issued a new decision declaring the Kingdom of
Denmark's and the Kingdom of Sweden's (collectively, the "States") participation
in the 2020 recapitalization of SAS as compatible State aid under the relevant
EU rules, subject to the introduction of a "step-up mechanism" for the States'
share investments, as further described below. The contemplated step-up
mechanism requires approval by the general meeting of shareholders in SAS AB
(the "Company"), which is to be summoned in short order.
In 2020, the States participated in the recapitalization of SAS through a
subscription for hybrid notes and common shares in the Company in an aggregate
amount of approximately SEK 9.5 billion (the "2020 State Investments"). The 2020
State Investments were initially approved by the European Commission in 2020 as
compatible State aid under the Temporary Framework for State aid measures to
support the economy in the COVID-19 outbreak (the "Temporary Framework").
However, in May 2023, the EU General Court held, following a third-party
challenge, that the European Commission had erred in its initial approval
decision by not requiring the States to include a "step-up mechanism", as
required by the Temporary Framework, in relation to the States' subscriptions
for common shares in the Company. As a result, the European Commission's initial
approval of the 2020 State Investments was annulled.
Today, the European Commission once again approved the 2020 State Investments as
compatible State aid under the Temporary Framework, subject to the introduction
of a step-up mechanism in relation to the States' 2020 share investments. The
contemplated step-up mechanism, which entails unilateral commitments from SAS to
issue new hybrid notes to the States without any consideration, under certain
conditions related to the States' 2020 share investments, requires approval by
the general meeting of shareholders in the Company as the commitments are deemed
related-party transactions under the Swedish Companies Act.
The contemplated step-up mechanism does not affect the investment agreement
entered into as part of SAS' chapter 11 process in the US, which, among other
things, entails equity investments in the reorganized SAS, as further described
in the press releases announced by the Company on October 3 and November 4,
2023, respectively.
SAS intends to convene an extraordinary general meeting of the Company's
shareholders, to be held in January 2024, to approve the contemplated step-up
mechanism within short order.
For further information, please contact:
SAS Press office, +46 8 797 29 44
Investor relations, +46 70 997 7070
SAS, Scandinavia's leading airline, with main hubs in Copenhagen, Oslo and
Stockholm, flies to destinations in Europe, USA and Asia. Spurred by a
Scandinavian heritage and sustainable values, SAS aims to be the driving force
in sustainable aviation and in the transition toward net zero emissions. We are
continuously reducing our carbon emissions through using more sustainable
aviation fuel, investing in new fuel-efficient aircraft and technology
innovation together with partners - thereby contributing towards the industry
target of net zero CO2 emissions by 2050. In addition to flight operations, SAS
offers ground handling services, technical maintenance and air cargo services.
Learn more at https://www.sasgroup.net
ADDITIONAL INFORMATION
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solicitation of an offer to buy or acquire, or subscribe for, shares or any
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