The airline SAS has applied to accelerate its new restructuring loan after DIP lender Apollo stated that SAS is violating loan terms in the agreement with Apollo.
This is evident from a motion from SAS to a US court where the airline has requested (and received) faster court processing of its new DIP loan (debtor-in-possession loan) from the investment company Castlelake, which is intended to become the new main owner of SAS.
The new date is set for Thursday, November 9, according to the court calendar.
In the motion to the American court, it can be read that SAS wants to "prevent immediate and irreparable harm" that could be the effect of a protracted handling.
SAS believes that demands for repayment of the original DIP loan, without any clarity on whether the new loan will be approved, could create additional uncertainty and risk in the long and medium term for SAS.
”"It is impossible for SAS to operate its business under Chapter 11 with the potential threat of enforcement action from its original DIP lenders," it further states.
At the same time, it can be read that SAS's original and current DIP lender, Apollo Global Management, believes that SAS has violated the loan terms in the agreement with Apollo and has sent a "Notice of Event of Default" to SAS.
”"This is a matter regarding the refinancing of our DIP loan. We are confident that we will receive approval but want to avoid any misunderstandings and problems that may result from a protracted process. We are therefore positive that the court has now granted our request for a hearing in the near future," SAS wrote in an email to Nyhetsbyrån Direkt on Tuesday.
When SAS announced this weekend that the airline had entered into an investment agreement with the winning bidding consortium in the procurement process for exit financing, SAS also stated that the airline had entered into a new agreement, a so-called DIP loan, for $500 million with Castlelake.
The new DIP financing was then said to be available to the airline after approval by the US court and the fulfillment of certain conditions.
It is the process surrounding this loan that SAS now wishes to speed up.
According to SAS, the new DIP financing will refinance and replace SAS's existing $700 million DIP financing agreement entered into with "funds managed by Apollo Global Management," the airline stated.
”"The terms of the new DIP financing are substantially consistent with the existing DIP financing, with certain significant differences such as a lower interest rate and the absence of certain fees and equity-related conditions," it further stated.
Source: Nyhetsbyrån Direkt
