=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2004/03/24/f= inancial1018EST0077.DTL --------------------------------------------------------------------- Wednesday, March 24, 2004 (AP) SAS announces deal with unions, split of major airline (03-24) 07:18 PST STOCKHOLM, Sweden (AP) -- Scandinavian airline operator SAS announced Wednesday it had reached wage agreements with its pilots and cabin crew that it said would help the company cut costs by about $1.7 billion by 2005. The SAS board also formally approved previously announced plans to split its largest carrier, Scandinavian Airlines System, into three wholly owned subsidiaries to operate flights in Denmark, Norway and Sweden. SAS said the deals with the pilot and cabin crew unions would help the company save the remaining 2 billion kronor ($270 million) needed for the company to reach its cost-cutting target of 14 billion kronor. "We have succeeded in achieving the savings required and thanks to the responsible actions of the unions we now have the conditions to become Europe's most competitive network company," chief executive Joergen Lindegaard said in a statement. Ahead of Tuesday's board meeting, management had threatened further job cuts, outsourcing and even closing some operations if labor unions rejected wage cuts and changed working hours. Earlier this month, SAS said it would restructure Scandinavian Airlines through a split along national lines. The division was expected to save money because each subsidiary could react faster to changed market conditions in each of the Scandinavian countries. In Norway, Scandinavian Airlines will be merged with Braathens, a SAS subsidiary, under the new name SAS Braathens, the company said. This would cut up to 300 million kronor ($40 million). The company posted a net loss of 1.4 billion kronor ($195.3 million) last year, as it failed to cut costs fast enough to offset the sharp decline in revenues due to intense price competition in the Nordic region. The SAS group also includes regional airlines Spanair, Braathens, Wideroe and Blue1, budget carrier snowflake and the Rezidor SAS hotel chain. On the Net: Company Web site: www.sas.se ---------------------------------------------------------------------- Copyright 2004 AP