US judge keeps SAS Airline’s restructuring on track with payment hearing

A US bankruptcy court judge granted SAS AB’s request to speed the process of paying $3 million to advisers of the Scandinavian airline’s investor group, keeping its restructuring on track over opposition from creditor Apollo Global Management Inc.

Judge Michael E. Wiles set an Oct. 12 hearing on a motion to expedite reimbursement to advisers to the group led by Air France-KLM and Castlelake LP, who are set to take control of the SAS as it exits from Chapter 11 protection. 

SAS’s request appeared to be “in the best interests of the debtors, their estates, their creditors, and all parties in interest,” the judge said in a court filing on Tuesday. 

Apollo had objected to the expedited hearing, arguing that the move would make it harder to prevail on its plan to object to the payment. It added that it won’t have enough time to review and respond to the reimbursement motion.

Apollo provided a $700 million debtor-in-possession term loan to SAS as it went through Chapter 11 reorganization. While the US equity firm reportedly sought to buy a majority stake, SAS last week chose the rival Air France-KLM group, which also includes the Danish state and Lind Invest ApS.