Struggling Scandinavian flag carrier SAS has signed an agreement to sell its regional subsidiary Widerøe as part of an ongoing restructuring program to achieve financial stability. SAS will sell 80 percent of Widerøe to Norwegian companies Torghatten ASA, Fjord1 AS and Nordland Fylkeskommune. The sales will include seven Bombardier Q400 turboprops that SAS currently leases to the regional carrier. The transaction must be approved by Norwegian authorities, and is expected to close in September.
Ailing Scandinavian carrier SAS will reduce its workforce by 6,000 employees, sell off its Widerøe regional subsidiary and centralize administrative functions in Sweden in return for an increased credit line from major shareholders and banks of 3.5 billion Swedish kronor ($525 million) through March 2015. The new revolving credit facility has yet to be approved by the parliaments of Sweden and Norway.
Scandinavian Airlines (SAS) has settled with Bombardier and Goodrich Aerospace the terms of a compensation agreement stemming from the airline’s grounding of its entire fleet of 27 Q400s last year. Although it would not disclose the precise conditions, SAS said the value of the compensation it will receive slightly exceeds 1 billion Swedish crowns ($163.5 million) in cash and credits for future firm and optional aircraft orders.
The European Aviation Safety Agency last month determined that the failure of the main landing gear of a Scandinavian Airlines Q400 on October 27 did not result from a design flaw, and that the latest incident bore no direct relationship with the two earlier cases that led to the grounding of the airline’s entire fleet of 74-seat turboprops.
SAS has again grounded all 27 of its Bombardier Q400s after the right main landing gear on one of its airplanes failed to fully extend upon landing in Copenhagen on Saturday. Flight SK2867 from Bergen, Norway, carried 40 passengers and four crewmembers, none of whom suffered injuries from the incident.
Finland’s Blue1 last month became the first regional airline ever to join the Star Alliance. A subsidiary of fellow alliance member SAS, Blue1 expects to complete its integration into the group by the end of this year. Formerly known as Air Botnia, Blue1 flies a fleet of nine Avro RJs and five Saab 2000 turboprops from Helsinki to 14 destinations in Scandinavia and continental Europe.
As the industry gathers in Gothenburg for this year’s general assembly, the ERA will certainly lament the absence of one of its stalwart airline members from Scandinavia–even if its passengers have taken little notice.