R5bn more needed to get SAA back in sky
The BRPs, Siviwe Dongwana and Les Matuson, said in a new draft business rescue plan that they wanted the government to provide R4.6bn for them to continue with the process.
The draft plan, contained in a document, was circulated to creditors, employees and the Department of Public Enterprises (DPE) yesterday.
The BRPs said the airline’s sole shareholder, the government through the DPE, should fund the plan in order for them to turn the airline into a viable and sustainable national flag carrier that provided international, regional and domestic services.
They said R2bn of the proposed cash injection - beyond the R16.4bn awarded to them thus far - would be used as working capital which was needed to restart the airline after the coronavirus travel ban.
Another R2bn, they said, would be used to cover the cost of retrenchments, and R600million would pay general concurrent creditors.
Both the BRPs and the DPE confirmed the existence of the draft plan and said it had been forwarded for affected parties to comment and consultation.
The BRPs said the document would be finalised by Monday.
The proposed plan comes weeks after Public Enterprises Minister Pravin Gordhan expressed his disappointment with the business rescue process and said the government had developed a plan to create a viable and competitive entity.
The BRPs said the proposed plan was for discussion purposes only and pleaded that it not be circulated to the media.
“Given that it is a draft and has not received agreement or comment from any of the relevant affected persons, we will not comment on the leaked draft to the media and will await input from the affected parties as is prescribed by the Companies Act. To assume and comment on this draft as if it is the final version would be very irresponsible,” the BRPs said.
SAA went into voluntary business rescue in December after the government decided it was the best way forward to resolve its myriad financial problems while continuing to operate.
SAA has not tabled its financials since 2017, despite receiving a total of R31.4bn in cash injections since 2003 and guarantees of R19.11bn, although not all of them were used.
Last month, the airline told Parliament that it made losses of R5.5bn in 2018 and R5.1bn last year.
DPE spokesperson Sam Mkokeli said the government had not discussed the plan yet.
Mkokeli said the department embraced the restructuring process as part of a path to a new, dynamic and financially viable airline that would serve South Africa’s economic and strategic interests.
“We will review the plan, explore various funding options, and communicate our decisions in due course,” said Mkokeli.