Spanair to shut down tonight after Qatar Airways declines to invest

Spanair (Barcelona) is due to cease all operations tonight after Qatar Airways (Doha) declined to invest in the money-losing airline today. In addition, the regional government of Cataluna has also declined to inject any further cash into the airline.

Read the story from Reuters: CLICK HERE

Part owner, SAS Group, issued the following statement:

“The SAS Group has continuously informed that following the divestment of most of its ownership in Spanair early 2009, the SAS Group has had a remaining exposure of approximately SEK 1.8 billion.

Spanair’s Board of Directors has today decided to apply for bankruptcy. Due to the situation in Spanair, SAS has decided to make a write down of the outstanding debt and receivables on Spanair of approximately MEUR 165, as well as reserve MEUR 28 in guarantees and costs due to the bankruptcy. SAS ownership in Spanair is currently 10,9%, but the value of these shares has already been written down and are booked at 0 value. The write down will affect the SAS Group’s result as a non-recurring item and equity negatively by SEK 1.7 billion in total. As informed earlier, the effect on the SAS Group’s liquid assets is estimated to be limited to MSEK 200-300.

SAS Group will follow customary procedures as a creditor in the upcoming bankruptcy process.

As reported as of the third quarter, SAS has a financial preparedness of SEK 10.6 billion so the event will have a limited effect on SAS liquidity.

SAS will assist passengers to the extent practically possible.

SAS expects a positive result before non-recurring items for the full year 2011.”

Spanair Slide Show: CLICK HERE

Copyright Photo: Bernard Ross. Please click on the photo for information on the carrier.