Norway govt seeks green light to sell SAS stake

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Norway govt seeks green light to sell SAS stake


Category: Airline / Travel

It also said on Friday it plans to maintain its overall ownership stakes in state companies at the current level and called for a stricter management pay policy.

Norway’s Trade and Industry Ministry said the airline, in which Sweden, Norway and Denmark hold a combined stake of 50 percent, faced difficulties and that any sale should be carried out in dialogue with other Nordic partners.

“In this context, it is appropriate to seek a new industrial solution for SAS,” the ministry said in its ownership report.

“SAS continues to face a number of challenges which they are likely to best meet with an industrial partner as owners.”

SAS, which has struggled for years to compete with budget carriers and to streamline its units, has been the subject of persistent media reports suggesting it could be taken over by a major European carrier such as Germany’s Lufthansa (LHAG.DE).

The Scandinavian governments have previously said they would consider selling their stakes and the Swedish centre-right government holds a parliament mandate to sell, though it has said this is unlikely until SAS is back on firm footing.

“We don’t see the ownership in SAS today as necessary to ensure good airline coverage,” Norwegian Trade and Industry Minister Trond Giske told a news conference.

Giske declined to say whether the government had received any interest for the stake.

SAS head of investor relations Sture Stolen said that the airline was not currently engaged in any merger talks.

SAS(SAS.ST) shares were first down before rising 2.7 percent at 22.60 Swedish crowns at 1225 GMT compared with a rise of 0.4 percent in STOXX Europe 600 travel and leisure index.

In the report, the Norwegian government also asked for the parliament’s authority to participate in potential share issues in part-owned Yara (YAR.OL) and Kongsberg Automotive (KOA.OL), and to keep its stakes in these companies.

“The government will maintain the scope of state ownership at about current levels,” the ministry said.

Apart from its 67 percent stake in oil and gas giant Statoil (STL.OL), the Norwegian state have big holdings in many of the Scandinavian country’s biggest companies such as Telenor (TEL.OL), Norsk Hydro (NHY.OL) and Yara (YAR.OL).

In addition, it asked for permission to sell its shares in unlisted maritime entrepreneur Secora and to sell or partly list shares in real estate firm Entra Eiendom.

It also said it does not rule out selling its 43.5 percent holding in fish farmer Cermaq(CEQ.OL) but that it was happy with its ownership today.

Giske said the state would continue to take an active role in share emissions and acquisitions by companies where it is an owner.

The ministry said it wanted tougher guidelines for top management salaries in state-owned companies and pay should be “competitive, but not driving” and more restrictive in terms of pensions and severance packages.

(Additional reporting by Victoria Klesty and Ole Petter Skonnord; Editing by Mike Nesbit)

Source: Reuters

Published: January 4, 2011