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SAAB BANKRUPTCY BATTLE

SAAB

Appeals court to review Saab reconstruction

The Swedish court of appeals has agreed to review the application from beleaugered Saab Automobile to undergo reconstruction, an application which was previously rejected by a lower court.

Appeals court to review Saab reconstruction

The firm gave a cautious welcome to the decision from its headquarters in Zeewolde in The Netherlands advising that the firm was “at ease with the decisino and is awaiting continued developments”.

But the appeals court decision does not mean that Saab Automobile will receive an automatic approval for its company reconstruction.

“This doesn’t give any indication of the case at hand,” said appeals court judge Peter Islander.

According to Islander it could be necessary to study the material submitted by Saab in greater details.

It is as yet unclear when the appeals court will convene to discuss Saab’s application for reconstruction, but the matter is expected to be settled in a couple of days.

“It takes longer to motivate and formulate a decision after a reconstruction application,” said Islander.

The court’s decision on Monday means that the IF Metall union is not required to join the other unions who have filed for bankruptcy against Saab, in order to avoid missing out on state salary guarantees.

The district court of Vänersborg in southwestern Sweden has scheduled in bankruptcy negotiations for next Monday. If the company is allowed to enter reconstruction then it gains formal protection against bankruptcy, and staff salaries will be paid from the state salary guarantee.

The court on September 8th rejected Saab’s request for bankruptcy protection, concluding that “there is not enough reason to believe that a company reorganisation would be successful”.

Saab Automobile immediately declared its intention to file an appeal of the ruling as the battle to keep the troubled firm afloat continued.

Saab’s debts amount to about €150 million euros ($210 million), according to Saab chief executive Victor Muller, and the company has stopped paying its suppliers who have in turn halted deliveries since April.

Saab employs 3,700 people.

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NORWEGIAN

Norwegian’s subsidiaries in Denmark and Sweden go bankrupt

The struggling low-cost airline Norwegian has reported its staffing subsidiaries in Denmark and Sweden have filed for bankruptcy, meaning roughly three quarters of its pilots and crew will lose their jobs.

Norwegian's subsidiaries in Denmark and Sweden go bankrupt
A Norwegian Air Shuttle plane: Photo: Norwegian

In a press release issued on Monday afternoon, the airline said that the financial support packages offered by the Swedish and Danish government had not been sufficiently generous to keep the subsidiaries which employ pilots and cabin crew in the two countries solvent. 

”The impact the Coronavirus has had on the airline industry is unprecedented. We have done everything we can to avoid making this last-resort decision and we have asked for access to government support in both Sweden and Denmark”, said Norwegian's chief executive Jacob Schram in the statement.  

“Our pilots and cabin crew are the core of our business and they have done a fantastic job for many years.”

“It is heart-breaking that our Swedish and Danish pilot and cabin crew subsidiaries now are forced to file for bankruptcy, and I’m truly sorry for the consequences this will have for our colleagues,”  Norwegian's chief executive Jacob Schram said in the statement.  

“We are working around the clock to get through this crisis and to return as a stronger Norwegian with the goal of bringing as many colleagues back in the air as possible.”

The company said it was also immediately ending staffing deals with the OSM Aviation, which supplies it with crew based in Spain, UK, Finland, Sweden and the US.

The company said that 1,571 pilots and 3,134 cabin crew would be affected by the move, with only the 700 pilots and 1,300 cabin crew based in Norway, France and Italy being kept on.

In the release, the company blamed the “the lack of significant financial support” from the Swedish and Danish governments, which it contrasted with that of Norway, which has agreed to pay “all salary related costs” while staff are furloughed. 

The companies declared bankrupt include: 
 
Norwegian Pilot Services Sweden AB
 
Norwegian Pilot Services Denmark ApS
 
Norwegian Cabin Services Denmark ApS
 
Norwegian Air Resources Denmark LH ApS
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