“Tremendous relief” after SAS deal reached

SAS employees and executives manage to negotiate a deal that will keep the airline flying

Nov 19, 2012

Updated – Nov 19, 17:10

With a deal to save SAS Airlines from bankruptcy seemingly in place, Danish politicians are expressing their relief that a last-minute agreement was reached.

Copenhagen's mayor, Frank Jensen (Socialdemokraterne), commended both sides for coming together to save SAS.

"It is a tremendous relief because there would have been serious consequences for Copenhagen, the Øresund region and for the whole of Denmark if they had not found a solution," Jensen told the Ritzau news bureau. "In terms of future employment in Copenhagen, it is vital that we have direct flight routes to growing markets in China, India and Brazil."

The finance minister, Bjarne Corydon (Socialdemokraterne), was similarly happy that the negotiations bore fruit.

"It is a good day for Denmark, and one must commend the parties that put the deal in place," Corydon told Ritzau. "It is a big relief that employees can maintain their jobs and that we can preserve Copenhagen as a travel hub with connections to the whole world."

Despite a deal that will see employees take significant pay cuts and work longer hours, Corydon refuted the notion that SAS's 2.8 billion kroner annual savings plan would threaten the so-called 'Danish model'.

"In many other Danish businesses, there have been deals made in which employees have been very responsible," he said. "What we see here is a desire for co-operation between employers and employees to hold on Danish jobs."

Previous reports

Nov 19, 15:12

Final union agrees to restructuring

SAS is now clear to implement its restructuring programme after agreeing to the terms of a new contract with its Danish cabin attendants.

The Cabin Attendants Union was the final holdout of a total of eight unions in Denmark, Sweden and Norway that the airline needed to reach a deal with before it could implement its plan to save 2.8 billion kroner annually in order to keep the company in operation.

The agreements struck over the past week will now be reviewed by the airline's board, together with representatives from the Danish, Swedish and Norwegian states, who collectively own half of SAS shares, representatives from the banks Nordea and Swedbank, and other major investors. Should the agreements be accepted, the plan will go forward.

Nov 19, 11:17

SAS shares soar on reports of agreement

News that SAS has reached an agreement with several of its employee unions has been well received by the markets this morning. As of 11am, the airline's shares were trading at 6 kroner, up about 20 percent over Friday's close.

SAS shares surged from the start of trading today on news that it only lacked an agreement with only Danish cabin attendants in order to be able to implement its restructuring plan aimed at keeping the company in business by saving 2.8 billion kroner annually,

Read our previous stories about SAS's most recent plan to shore up the ailing airline