(Reuters) – Scandinavian airline SAS said on Saturday it had reached an agreement with Apollo Global Management to raise $700 million in new funding it needs to weather bankruptcy.

The airline filed for bankruptcy protection in the United States in early July to help reduce its debt after wage negotiations between the airline and its pilots broke down, triggering a 15-day strike that added to the chaos of travels through Europe.

SAS said in a statement that it expects to complete the Chapter 11 restructuring process in nine to 12 months. The airline expects to receive court approval for its $700 million financing by the end of September.

SAS chief executive Anko van der Werff said the strike had accelerated his decision to seek Chapter 11 status.

The airline said the industrial action has cost it more than $145 million, affecting 380,000 passengers during the peak summer travel season, and could jeopardize the company’s ability to secure additional funding.

SAS grounded some 3,700 flights during the strike, saying that last week its passenger numbers fell by 32% in July compared to June and its capacity by 23%.

Members of the Swedish, Danish and Norwegian pilot unions, who voted to pass a collective agreement with SAS last month, said they would not resume their strike.

SAS, which was already loss-making before the pandemic due to growing competition from low-cost carriers, had said it needed to cut costs further and raise more capital to survive.

While the Swedish government has rejected calls for more cash, Denmark has said it could inject new funds if SAS also finds support from private sector investors.

(Reporting by Mrinmay Dey in Bengaluru; Editing by William Mallard)

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