No deal yet in airline SAS's survival talks with unions

Sun Nov 18, 2012 3:40pm EST
 

By Johan Ahlander and Anna Ringstrom

COPENHAGEN/STOCKHOLM (Reuters) - Troubled Scandinavian airline SAS (SAS.ST: Quote) and unions held vital talks on Sunday aimed at ensuring the company's survival and avoiding bankruptcy, but no deal had been reached by the evening.

The Scandinavian airline, hit by competition from lower-price rivals, last week announced plans to cut some salaries by up to 17 percent and reduce overall headcount to about 9,000 from 15,000.

A newspaper said board members were meeting banks in Stockholm after talks with unions that began on Thursday at SAS headquarters at the main airport in Copenhagen.

SAS spokeswoman Elisabeth Manzini declined to confirm whether a meeting with banks was taking place.

Fueling fears aired widely in the Scandinavian media that the lack of a deal might lead to an immediate bankruptcy application, she said the airline had told crews to make sure airplanes were fully fueled to return home if necessary.

The airline was also giving cash to flying staff to ensure they could get access to hotels if there was a bankruptcy.

"Due to the fact that this is a very serious situation for SAS right now it is our responsibility as a company and employer to secure our assets, regarding staff as well as planes," she said.

However, she declined to say how long SAS's cash would last if the loans with the banks were not agreed to.   Continued...

 
A ground staffer carries warning cones between two SAS Boeing 737 aircrafts parked at Arlanda airport's Terminal Five, north of Stockholm November 13, 2012. REUTERS/Johan Nilsson/Scanpix