OSLO: Sweden and Norway cut their holdings in Nordic carrier SAS AB through a public share sale and said they ultimately plan to exit their stakes entirely, a move that could pave the way for the company’s consolidation into one of Europe’s bigger airline groups.
Sweden’s shareholding in the Scandinavian Airlines parent was reduced to 17.2 percent from 21.3 percent and Norway’s to 11.5 percent from 14.2 percent, according to a statement Thursday. Denmark, which owns 14.2 percent of SAS, didn’t participate in the book-building process.
“The sale is the first step in a gradual and responsible disposal of the Swedish and Norwegian states’ ownership,” Sweden’s government said in a statement, adding that the move will include a new ownership structure and is intended to strengthen the Stockholm-based company.
A glut in airline seats as European economies stutter and a wave of terrorist attacks puts people off travel has led to a slump in fares and pushed carriers such as Air Berlin Plc to consider merger options. SAS faces a squeeze both from discount specialists such as Norwegian Air Shuttle ASA and network giants Air France-KLM Group, IAG SA and Deutsche Lufthansa AG, as well as Gulf carriers such as Dubai-based Emirates on inter-continental routes.
SAS stock was trading down 5.5 percent at the 15.5 kronor as of 9:01 a.m. in Stockholm, the price at which Sweden and Norway sold a total of 23 million shares after raising the offering from 19 million to meet investor demand. That takes the decline this year to 36 percent and values the company at 5.12 billion kronor ($578 million).
