State aid: Commission approves €1 billion Danish and Swedish measure to recapitalise SAS
Daily News 18 / 08 / 2020
Source: European Commission Spokesperson's Service
The European Commission has approved Danish and Swedish plans to contribute up to SEK 11 billion (approximately €1 billion) to the recapitalisation of SAS. The measure was approved under the State aid Temporary Framework. The recapitalisation measure is part of a larger recapitalisation package, which also foresees a significant participation of private investors, including the conversion of outstanding privately-held debt instruments into equity. SAS is a major network airline operating in Denmark, Sweden and Norway. In the second quarter of 2020, SAS suffered substantial losses due to the coronavirus outbreak and the travel restrictions that Denmark, Sweden and other countries had to impose to limit the spread of the coronavirus. The Commission found that measure notified by Denmark and Sweden is in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. The Commission concluded that the recapitalisation measure will contribute to manage the economic impact of the coronavirus outbreak in Denmark and Sweden: the measure aims at restoring the balance sheet position and liquidity of SAS in the exceptional situation caused by the coronavirus pandemic, while maintaining the necessary safeguards to limit competition distortions. It is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of the two Member States, in line with Article 107(3)(b) TFEU and the general principles as set out in the Temporary Framework. On this basis, the Commission approved the measure under EU State aid rules. Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “SAS plays a key role for the connectivity and economy of Scandinavian countries. As many other companies active in the aviation sector, SAS has been severely hit by the current crisis. With this measure, Denmark and Sweden will contribute up to €1 billion to SAS's recapitalisation and help the airline weather the current crisis. At the same time, the Member States will be sufficiently remunerated for the risk taxpayers assume, and the support will come with strings attached to limit distortions of competition. I welcome the participation by private investors to the plan, as it limits the need for State aid, while contributing to the recovery of companies affected by the coronavirus outbreak.” A full press release is available online.