STOCKHOLM – Airline SAS plans to raise 9.5 Billion Swedish crowns (or $972 million) for new cash. It warned on Tuesday about liquidity problems if they fail, as the airline suffered a narrower loss in February and April than a year ago.

Part-owned by Sweden, Denmark, and having struggled for many years, the carrier announced in February a significant new restructuring plan. It stated that this was dependent on raising new capital.

Sweden and Denmark didn’t say whether or not they would make a payment after the airlines in 2020 had received a rescue package of three billion crowns from their governments.

SAS shares dropped 9% during early trade Tuesday.

SAS announced Tuesday, “In addition to reducing costs and improving efficiencies SAS seeks to convert approximately SEK20 billion of debt/hybrid notes into common equity. SAS will also attempt to raise at least SEK 9 billion in equity capital.”

Requests for comments from the Swedish and Danish government were not answered on Tuesday by either country. SAS stated that discussions had been “limitedly successful” with stakeholders.

It stated that SAS would not be able support its current capital structure or liquidity levels if the planned burden sharing, debt converts and new capital raising are not carried out as expected.

SAS posted a second-quarter fiscal loss before taxes of 1.56 billion crowns, compared to a loss of 2.33 billion a year earlier.

The airline was already in financial trouble before the outbreak of coronavirus, which caused high prices and increased competition. SAS, which has 75,000 flights in total, is currently struggling to rebuild the aviation industry after COVID.

Anko van den Werff, CEO of the company said that they are experiencing healthy demand but still have uncertainty.

The geopolitical environment and COVID-19 limitations continue to affect traffic from Asia.

($1 = 9.7718 Swedish Crowns