SAS seeks time to gather Chapter 11 financials after strike depletes resources | New

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Scandinavian operator SAS has asked for more time to gather and submit details of its financial affairs for US Chapter 11 proceedings, citing the stretching of its resources during the recent pilot strike.

SAS and 13 affiliates and subsidiaries filed for Chapter 11 protection on July 5, the day after the flight deck crew launched an industrial action.

The strike lasted 15 days and SAS – which initially estimated the cost of the walkout at 1.5 billion Swedish crowns ($147 million) – is still calculating the specific financial impact of the action, which led to the cancellation of 3,700 flights.

Under US bankruptcy regulations, SAS had to file details of assets and liabilities, as well as financial statements, within 14 days – a July 19 deadline.

While SAS, assisted by professional advisers, mobilized its employees to work “diligently and expeditiously” to prepare the returns, its resources were “stretched”, a court filing said.

“Collect the information necessary for the preparation of the [documents] takes a lot of time and effort on the part of [SAS and the affiliates]“, he adds.

“This expenditure of time and effort has been particularly difficult for [SAS] following the pilots’ strike which concluded [on 19 July].”

It says some 900 pilots were involved in the industrial action and that it “severely hampered” the carrier’s operations, forcing employees – including those needed to collect financial information – to “focus their efforts on fallout from the strike.

Although the strike has ended, the pressure on SAS remained due to the restoration of flight schedules and the reorganization of travel reservations for passengers affected by cancellations and delays.

“These issues continue to demand [SAS’s] our full attention during the already busy summer travel season,” the filing reads.

“Given the amount of work required to complete the [documents]and the many competing demands on the [company’s] employees and professionals to stabilize business operations…[SAS] will not be able to compile properly and accurately [documents] within the legal period of 14 days.

SAS lawyers have requested a “modest” 14-day extension to the deadline, pushing it back to August 2. They point out that it would still be well before a meeting of creditors scheduled for August 18.

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