European Commission, Press release, Brussels, 9 July 2014:
The European Commission has
concluded that a Revolving Credit Facility (RCF) that Denmark, Sweden
and Norway granted to SAS in December 2012 was carried out on market
terms and therefore did not constitute state aid within the meaning of
EU rules.
SAS is the major air carrier in
Scandinavia. Its four biggest shareholders are Sweden (21.4%), Denmark
(14.3%), Norway (14.3%) and the Knut and Alice Wallenberg foundation
(KAW) (7.6%). SAS's financial position has been problematic for several
years and its financial performance has deteriorated significantly since
2008.
In recent years, SAS has been
enjoying an RCF provided by several banks, which should originally have
expired in June 2013. The banks refused to renew this RCF without a
substantial participation from Denmark, Sweden and Norway. In December
2012, the three States decided to finance half of a new RCF of SEK 3.5
billion (around €400 million), together with KAW and the majority of the
banks that participated in the old RCF. The measure is linked to the
implementation of SAS's new business plan.
The Commission opened an
in-depth investigation in June 2013 to assess the conformity of the new
RCF with EU state aid rules (see IP/13/567).
Under EU rules, a public support measure does not constitute state aid
if it was concluded on terms that a private player operating under
market conditions would have accepted (the market economy investor
principle).
In its investigation, the
Commission found that the three states and the banks were not in a
comparable position when deciding to participate in the new RCF, in
particular in view of the exposure of some of the banks towards SAS
beyond the RCF. However, the investigation has also established the
robustness of the underlying assumptions of the business plan. Indeed,
the plan has been reviewed by external advisers who confirmed its
credibility. The plan is therefore an economically reasonable basis for
the three States' decision to participate in the new RCF. Moreover, the
risks taken by the States were further reduced as the collateral of the
new RCF was sufficient.
On this basis, the Commission
reached the conclusion that the new RCF was concluded on terms that a
private investor operating under market conditions would have accepted.
It therefore procured no undue economic advantage to SAS and did not
entail state aid. The new RCF was never used and was effectively
cancelled on 4 March 2014.
Background......................http://europa.eu/rapid/press-release_IP-14-797_en.htm?locale=en
9/7/14
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