SAS — Capital/Financing Update 2010

Mar 19, 2010

SAS AB (publ) launches SEK 1.42 billion convertible bond offering

NOT FOR DISTRIBUTION IN OR TO THE U.S., CANADA, AUSTRALIA, OR JAPAN, OR

IN ANY OTHER JURISDICTION IN WHICH SUCH DISTRIBUTION WOULD BE PROHIBITED

BY APPLICABLE LAW

SAS AB (publ) launches SEK 1.42 billion convertible bond offering

SAS AB (publ) ("SAS" or the "Company") announces today that it intends

to issue SEK 1.42 billion in aggregate principal amount of convertible

bonds (the "Bonds") due in 2015.

The senior unsecured Bonds are expected to bear interest in the range of

7.50% - 8.50% payable quarterly in arrear and will be convertible at a

conversion price equal to a conversion premium of 25% - 30% over the

volume weighted average price of the Company's shares on NASDAQ OMX

Stockholm between launch and pricing.

Conversion rights in respect of the Bonds will be settled in cash unless

the Annual General Meeting on 7 April 2010 (the "AGM") passes

resolutions related to the rights issue of common shares, including

amendments to the Articles of Association of the Company, and an

authorization for the Board of Directors to issue convertible bonds.

If the proposed rights issue of shares does not close, the Company shall

redeem the Bonds in cash on or around 15 May 2010 at 100% of the

principal amount of the Bonds, together with accrued but unpaid

interest.

The Bonds will be issued at 100% of their principal amount and will,

unless previously redeemed, converted or purchased and cancelled, mature

in 2015. SAS has the right to redeem the Bonds after approximately three

years following the issue date if the value of the SAS shares underlying

one Bond on NASDAQ OMX Stockholm exceeds, for a specified period of

time, 150% of the principal amount of a Bond.

The issue date for the Bonds is expected to be on or around 1 April

2010. The Bonds will not be listed on issue. The conversion price of the

Bonds will be adjusted to take into account the effect of the rights

issue of common shares.

As previously disclosed, the Company will, subject to the AGM's

approval, carry out a preferential rights issue for approximately SEK 5

billion. The rights issue is supported by the Company's four largest

shareholders and by a syndicate of underwriters on the conditions that,

inter alia, the Group refinances approximately SEK 2 billion in

aggregate principal amount of bonds maturing in 2010 and a final

agreement on SEK 500 million in cost-cutting measures is reached with

unions representing the Group's pilots and cabin crew personnel. A final

agreement was reached with the unions on 12 March 2010.

With respect to the refinancing, the proceeds from the issue of the

Bonds and the previously announced EMTN financing will be used to repay

certain of the Company's outstanding bonds maturing in 2010. The Company

has also recently issued bonds on the EMTN market in an aggregate

principal amount of Euro 60 million, or approximately SEK 600 million. Upon

the issue of the Bonds, SAS will have met the condition to refinance

approximately SEK 2 billion of its bonds maturing in 2010 and thereby

two key conditions for the rights issue. SAS expects to announce the

final terms and conditions of the Bond issue on 19 March 2010.

The Board of Directors intends to exchange the Bonds into convertible

bonds, which may be converted into common shares of the Company, on or

around 14 May 2010, when all resolutions relating to the rights issue of

common shares and the authorization of the Board of Directors to issue

the convertible bonds have been registered with the Swedish Companies

Registration Office.

In line with market practice for convertible bond transactions in

Europe, the Bonds will be marketed principally to European institutional

investors who have specialized knowledge of such instruments.

J.P. Morgan is acting as sole bookrunner with respect to the issue.

This announcement does not constitute or form part of an offer to sell

or the solicitation of an offer to subscribe for any securities of SAS.

For further information, please contact

Sture Stølen, Head of SAS Group Investor Relations, +46 70 997 1451.

SAS discloses this information pursuant to the Swedish Securities Market

Act and/or the Swedish Financial Instruments Trading Act. The

information was provided for publication on 19 March 2010, at 8.15 am

CET.

Important Note

This press release is not being issued in or to the United States of

America, Canada, Australia, Japan or in any other jurisdiction in which

such distribution would be prohibited by applicable law. This press

release does not constitute or form part of an offer or solicitation of

an offer to purchase or subscribe for securities in the United States.

The Bonds and the shares referred to herein will not be registered under

the United States Securities Act of 1933, as amended, and may not be

offered or sold in the United States, except pursuant to an applicable

exemption from registration.

This press release is directed only at persons who (i) are outside the

United Kingdom or (ii) have professional experience in matters relating

to investments who fall within Article 19(5) ("investment

professionals") of The Financial Services and Markets Act 2000

(Financial Promotion) Order 2005 (as amended) (the "Order") or (iii) are

persons falling, within Article 49(2)(a) to (d) ("high net worth

companies, unincorporated associations etc") of the Order (all such

persons together being referred to as "relevant persons"). This press

release is directed only at relevant persons and must not be acted on or

relied on by persons who are not relevant persons. Any investment or

investment activity to which this press release relates is available

only to relevant persons and will be engaged in only with relevant

persons.

In addition, if and to the extent that this press release is

communicated in, or the offered securities to which it relates is made

in, any EEA member state that has implemented Directive 2003/71/EC

(together with any applicable implementing measures in any member state,

the "Prospectus Directive"), this press release and the offering

described herein are only addressed to and directed at persons in that

member state who are "qualified investors" within the meaning of the

Prospectus Directive (or who are other persons to whom the offer may

lawfully be addressed) and must not be acted on or relied on by other

persons in that member state.

J.P. Morgan is acting for the Company and no one else in connection with

the offer of the Bonds and will not be responsible to any other person

for providing the protections afforded to their client, or for providing

advice in relation to the proposed offer of the Bonds.