SAS take over of Braathens has been approved
The Norwegian Competition Authority has announced its approval of the SAS’ acquisition of the Norwegian airline Braathens. (10/25/2001)
SAS acknowledges that the KT is not taking action for the moment against frequent flyer programs, corporate client agreements and agency deals.
The agreement between Braathens’ majority shareholders and SAS contains a number of conditions in addition to approval by the authorities. Such conditions are customary in an agreement of this kind, and relate in ail to the financial status of Braathens and to certain legal aspects.
Furthermore, other conditions include the acceptance of the offer by shareholders representing more than 90 per cent the Braathens shares and completion by 31 December 2001, must also be fulfilled before the transaction can be implemented.
However, it is unclear today whether the terms and conditions specified in the agreement are or can be fulfilled. This will be clarified in the immediate future.
SAS has been and remains of the view that consolidation is necessary to safeguard and strengthen Norway’s civil aviation system, and thereby to secure satisfactory terms and competitiveness for this sector internationally. The tragic events of 11 September have further underlined the need for such strengthening.
At the same time, the position in the civil aviation business has changed dramatically since the agreement was concluded in May. The whole industry faces very substantial challenges, and some companies are already experiencing acute financial problems.
Norway’s airlines are not exempted from similar challenges. SAS has already reduced its production by 12 per cent, taken 16 aircraft out of service and cut its workforce by the equivalent of about 1 000 fulltime jobs.
SAS will now concentrate on the further process, which involves clarifying all the terms and conditions that must be fulfilled for the transaction to be implemented as agreed.
Author:Newsdesk, eyefortransport.com
