SAS resumes talks with pilot unions as most flights grounded

Scandinavian carrier SAS AB resumed negotiations with pilot unions in Stockholm on Wednesday in an effort to resolve a strike that has grounded most of its flights just as the busy travel season gets underway.

The staff walkout started 10 days ago after negotiations over an improved pay deal broke down with unions representing about 1,000 cockpit crew. SAS Chief Executive Anko van der Werff described the walkout at one of the busiest times of year as “devastating,” and it is estimated to be costing the airline as much as $9 million a day in refunds and lost ticket sales.

The carrier canceled 242 flights or 74% of its planned departures on Wednesday, according to tracking website FlightAware.com. Still, the resumption of talks will offer some relief for travelers and shareholders alike. The airline’s stock has advanced 39% so far this week to 0.7 kronor (6.6 US Cents) per share, giving it a market value of $465 million.

The Nordic region’s biggest airline, which filed for Chapter 11 bankruptcy protection in the US last week, is currently locked in negotiations with investors over bridge financing of up to $700 million as well as a $3 billion restructuring of its balance sheet involving new equity and the conversion of existing debt into shares.

The governments of Sweden and Denmark each own a 21.8% stake in SAS after it was bailed out in 2020. While Denmark has said it’s open to adding to its holding, Sweden’s government flagged it will accept a conversion of debt it is owed into equity, but won’t participate in a new capital raise.

The fresh round of talks is taking place at the offices of the Confederation of Swedish Enterprise in Stockholm, news agency TT reported. SAS on Monday said it wished to resume mediation with the unions and acknowledged the need for “concessions from both parties.”