Star Alliance member Scandinavian Airlines has a shareholder program open to anyone who owns at least 4000 shares in the carrier. What’s most interesting is the benefit for those who own 100,000 shares.
A purchase of 100,000 shares entitles you to Star Alliance Gold. At current US dollar pricing of 27 cents a share, that’s a $27,000 investment.
- I wouldn’t pay $27,000 for SAS Gold which is Star Alliance Gold.
- But maybe it’s worth investing in the stock? Let’s assume the shares retain their value, neither going up nor down. In that case you still have your $27,000 and for the cost of a trading commission you get a tax-free dividend in the form of Gold status.
Now, I do not giving stock trading advice. And you have to register your account in a Scandinavian country to do this, which I won’t tell you to do either. My own general approach is to buy lowest cost broad-based stock mutual funds and exchange traded funds rather than investing in individual stocks or even sectors.
However unless you think the airline is going out of business – after receiving a US$1.5 billion bailout this summer – it may not be a bad play, of course you risk losing some of your principal. (I just happen to think a year from now the stock won’t be worth ‘less than’ it is today. That’s a bet on my optimism overall about therapeutics and a safe and modestly effective vaccine).
Gold status normally requires 45 flight segments or 45,000 base points. You get:
- lounge access when flying Star Alliance carriers like United (i.e. access to United Clubs, Lufthansa and Turkish lounges, etc)
- Airport priority and extra checked baggage.
- There are also benefits with Radisson, Scandic, and other hotel chains for SAS EuroBonus Gold members.
It’s worth noting that 1 million or more shares entitles you to SAS Diamond status but that’s not something I’d consider since as an American not regularly flying SAS Diamond status doesn’t really provide incremental benefits when flying United Airlines. That – and we’re talking about a ton of money to risk. I wouldn’t let this offer drive your investing decisions but for those inclined to bet on SAS stock anyway Gold status seems a sweet spot.
Status offers require you to acquire stock by November 30, and it can take a month of holding the stock before your status as a stockholder is reflected in the system allowing you to register for benefits.
Bear in mind that you can accomplish the same thing with an elite status match. Turkish Airlines has historically given those out liberally, although dealing with them can take awhile. TAP Air Portugal gives out matches, but requires you to buy miles first. I wouldn’t be surprised if we see more creative ‘purchase status’ offers, along the lines for instance of Avianca selling their status for $2200 (the same, I suppose, as locking in the SAS deal at an 8% loss).
(HT: James)
This benefit appears to be only available to Scandinavian residents. On the terms page (https://www.sasgroup.net/investor-relations/shareholder-program/terms-and-privacy-policy/) the following restriction is listed:
2.1 To participate in the Program and hence be eligible to receive the benefits that correspond to the Participant’s shareholding level, as set out in Section 3 below, the Participant shall be:
(a) permanently resident in Sweden, Norway or Denmark;
@ Gary — I’ll just use a lighter.
Blue Horseshoe loves Blue Star Airlines?
Or is this more of a Alexei Koval, Guilford Pharma “frequent flyer” deal 🙂
you are missing out on the opportunity costs. My funds have returned almost 27 percent this… at 27k, that would be worth at least 7000-8000 dollars just for the year. i don’t think any airline status is worth that much and if it is, you already have it the ‘natural’ way.
@R – “past performance is no guarantee of future performance”
I wonder if other struggling airlines, such as Cathay, Thai, Singapore will follow similar suit.
Unless you’re a resident of one of the relevant Scandinavian countries listed in the offer, this offer won’t work.
You may even want to assume that SAS has a requirement to match up the purchasing shareholder’s Scandinavian equivalent of a US social security number in order for the registered shares of the registered share owner to even be able to partake of this. And that would generally mean that the person is subject to global taxation as a recognized resident of the relevant Scandinavian country. The info in the Scandinavian population registers under those SSA-equivalent numbers are generally the definitive answer for whether or not a person is to be considered a resident for Scandinavian taxation purposes.
And speaking of taxation, the Swedish tax authorities want to file through the list of all of the Swedish EuroBonus Diamond customers from at least 2017 to see how and if to subject them to taxation for the personal use of points earned from work travel.
Well, given the likelihood of USD weakness increasing with a Biden electoral victory this November, making an investment in Swedish crowns terms now may come with a forex winning boost in USD terms too when selling the shares and moving back to US dollars.
For this offer and its benefits for one year in 2021, it seems like a person only has to hold the shares and get them registered before November 30th of this year.
If SAS Diamonds can hand out complimentary Gold status to one or two members, maybe some Americans would play this SAS AB shareholding move via a Scandinavian relative/friend. But given the legal hassles — courtesy of the US Treasury/IRS — that would come from a US person having beneficial ownership/control of $10k or more in a foreign account outside of the US, probably not worth it from that angle too. Especially when you consider how ugly the US Treasury/IRS penalties are for compliance failures (in reporting) when it comes to Americans having $10k or more money parked in a financial institution outside of the US.
Ha, per the tweets, SAS stock up big today. Gary Leff moves markets!
Buy in November and sell in February?
It might actually be possible to mitigate the risk for some cost by purchasing the shares and at the same time purchasing an option to sell them for their today’s price at some future date (when the eligibility check is done).
However, I am not sure if there is an exchange selling SAS options.
Too volatile. What’s to stop daytraders. from selling everything once the status has been conferred? There should be incentives for investors to retain their shares, like monthly verification of keeping 100k shares.
From the end of sas explanation
To be eligible to receive the benefits in 2021 you must have owned the shares on 30 November 2020. And you must own shares as a private individual, placed in a custody account or ISK account.
To be eligible for the program the following year and receive the benefits in 2022 you must have owned the shares during the 12 preceding months to the annual control date 30 November 2021.
EuroBonus Gold and EuroBonus Diamond status, awarded in the Shareholder program, are not qualifying for Life Time Gold.
A maximum of 5000 EuroBonus Gold status will be awarded per year, in the Shareholder program, and they will be based on the size of your holding.
2023 update: SAS shares are going for under $0.03 as I type this, so if you had invested that $27k, it would be worth less than $3k now, a -88% ROI.
That’s only if you held them for three years.