SAS Scandinavian Airlines (SK, Copenhagen Kastrup) has filed a second amended restructuring plan with the United States Bankruptcy Court for the Southern District of New York as part of its ongoing Chapter 11 process, claiming to have obtained the support of the majority of unsecured creditors.

The amended plan includes allocating up to USD325 million to its general unsecured creditors, consisting of a maximum total of USD250 million in cash and USD75 million in new equity, it explained in a statement on February 5. This new equity would be distributed to creditors like the states of Denmark, Sweden, and Norway as well as “go-forward aircraft lessors, pilot unions, key suppliers, and certain other creditors with claims” against the cash-strapped carrier.

Holders of commercial hybrid bonds are likely to get no more than 25% of their claims back: 6.9 to 9.4% of the nominal value of such claims when it emerges from bankruptcy proceedings, probably around June, with “the possibility of receiving another cash distribution of up to 13.1-15.6%” at a later date, meaning “up to” 20% to 25% cumulatively.

There will be no recovery of funds at all for subordinated creditors and “no value for SAS AB’s existing shareholders,” it said. All common shares and listed commercial hybrid bonds will be cancelled, redeemed, and delisted.

SAS filed for bankruptcy in July 2022, a move that came a month after Sweden’s government said it would not inject any new capital into the struggling carrier. However, in early October 2023 it reached a USD1.2 billion refinancing deal with a consortium including Air France-KLM, lessor Castlelake, Danish investment firm Lind Invest ApS, and the Danish state.

In a regulatory filing on January 23, SAS said it expected that “its net debt will range” between SEK36 billion and SEK39 billion kronor (USD3.4-3.7 billion) prior to emergence from the Chapter 11 process, and SEK22 billion to SEK24 billion (USD2.1 billion to USD2.3 billion) after the process.

The government of Norway, which sold the remaining stake it had in SAS in June 2018, may now end up again becoming a co-owner of the the carrier. According to the estimates of the Norwegian online business newspaper E24 Næringsliv, SAS owes Norway just over NOK1.6 billion kroner (USD151 million) including interest. With the newly filed restructuring plan, Norway now has the prospect of getting NOK150 million (USD14 million) back this year and, if all goes well, NOK250 million (USD24 million) in a few years’ time - in a mix of cash and shares; it will again become a SAS shareholder.

Norway’s business minister, Jan Christian Vestre, will decide this month whether the country will agree to re-enter as a small co-owner, E24 reported. The Danish government has continued to support the airline, but Sweden decided in June 2022 that it would not. Shareholders may yet want to buy out Sweden and Norway, E24 suggested, but time will tell.