March 17, 2020 / 5:13 PM / in 18 days

RPT-UPDATE 1-Struggling airline SAS wins $300 mln support from Denmark, Sweden

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COPENHAGEN, March 17 (Reuters) - The Danish and Swedish governments said on Tuesday they had decided to provide guarantees to struggling airline SAS totalling 3 billion Swedish crowns ($302 million).

The carrier has grounded most of its fleet and announced temporary layoffs of 90% of its staff amid the coronavirus outbreak that has brought global aviation to a near standstill

“This is a first step and the Danish state will as a long-term and responsible co-owner of SAS closely monitor developments and do whatever is necessary for SAS to get through the crisis and be operational after,” Denmark’s Finance Minister Nicolai Wammen said in a statement.

The credit guarantee was given to facilitate SAS’ ability to borrow money despite its fragile situation. The Swedish and Danish states hold 14.82% and 14.24% stakes in SAS respectively.

In a separate statement, the Swedish government proposed that airlines in 2020 would be given the opportunity to obtain credit guarantees worth a maximum of 5 billion crowns ($504 million) of which 1.5 billion would be directed to SAS.

“The purpose of the current proposal is to fundamentally protect viable Swedish airlines from being eliminated as a result of the current situation,” Sweden’s finance ministry said. ($1 = 9.9421 Swedish crowns) (Reporting by Stine Jacobsen in Copenhagen and Anna Ringstrom in Stockholm, editing by Terje Solsvik/Keith Weir)

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