Apollo’s Attempt to Halt SAS Scandinavian Court Hearing Foiled as Judge Prioritizes Consortium’s Reimbursement

In a recent development, Apollo Global Management’s attempt to stall the court hearing for SAS Scandinavian Airlines has been thwarted. Despite losing the bid for the majority shareholding in SAS, Apollo sought to delay the October 12 hearing in the New York Bankruptcy Court, where a decision on reimbursing the winning consortium with USD3 million for bid-related expenses would be made.

The consortium, comprised of Air France-KLM, Castlelake, Lind Invest ApS, and the Danish state, secured the bid on October 3 by providing USD1.175 billion in Chapter 11 exit financing. This financing includes a combination of new equity and convertible debt, granting them over 86% of SAS’s shareholding.

SAS urgently requested an expedited hearing on October 6 to meet a deadline of October 10, by which the airline had committed to reimbursing the consortium for their incurred expenses. However, Apollo raised objections, contending that SAS failed to demonstrate why the reimbursement was an emergency, and that the accelerated timeline could prejudice interested parties, including Apollo.

Despite Apollo’s objections, Judge Michael E. Wiles overruled the attempt to delay proceedings on October 10. He determined that an expedited hearing was in the “best interest of the debtors, their estates, their creditors, and all parties in interest.” As a result, the court hearing is scheduled to proceed on October 12, marking a significant setback for Apollo’s efforts to disrupt the reimbursement process.