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Troubled SAS rejects bankruptcy rumours

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Troubled SAS rejects bankruptcy rumours
09:07 CET+01:00
Scandinavian airline SAS has moved to quash rumours that it is facing bankruptcy and that banks are considering not extending loans to the troubled carrier.

"There has been speculation all autumn, there are new things almost everyday, but nothing is decided," said SAS communications head Knut Morten Johansen to the Norwegian website E24.no.

The media has been awash with reports that SAS is facing insolvency, that its banks were losing patience and that the company is set to be sold.

Johansen rejected the sale rumours, explaining that the speculation was "frustrating".

According to a report in the Dagens Industri business daily this week, the airline and its three major shareholders - the Swedish, Norwegian and Danish states - held meetings with its creditors to discuss the airline's future.

The Swedish state has invested some 2.4 billion kronor ($360 million) in the loss-making airline in the past three years, money which has long since been exhausted.

The airline posted losses of 1.69 billion kronor in 2011 and CEO Rickard Gustafsson pledged to accelerate the firm's cost-cutting programme, seeking five billion kronor in savings and new revenue in 2012.

According to the Dagens Industri report, the company's loan facilities expire in March 2013 and rumours that the banks were disinclined to extend the loans have persisted.

Rumours of a sell-off have been circulating since 2008, with Lufthansa long seen as the most probable buyer. A concrete bid has however never been tabled.

Any sale of the company is complicated by its ownership structure with Sweden, Norway and Denmark all required to agree any eventual sale.

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