Unions Numsa and the SA Cabin Crew Association are at loggerheads with the government over the application by business rescue practitioners.  Nicholas Rama African News Agency (ANA)
Unions Numsa and the SA Cabin Crew Association are at loggerheads with the government over the application by business rescue practitioners. Nicholas Rama African News Agency (ANA)

Unions oppose SA Express business rescue liquidation bid

By Siphelele Dludla Time of article published Apr 1, 2020

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JOHANNESBURG - Unions Numsa and the SA Cabin Crew Association are at loggerheads with the government over the application by business rescue practitioners to liquidate the state-owned regional airline, SA Express.

The unions yesterday said that the government should take responsibility for the destruction of the airline.

In a strongly-worded statement, the unions said SA Express was being destroyed by the government’s lack of commitment to save state-owned entities (SOEs), especially those in aviation.

“It seems what we have been warning about in relation to SOEs is coming to fruition,” the unions said.

SA Express was last month placed under involuntary business rescue due to financial pressures that resulted from years of poor management and state capture.

The application to place SA Express under business rescue was brought by ZieglerSA, a global logistics company, which was a service provider to the airline, and is owed R11.3 million.

In court papers, SA Express rescuers Phahlani Mkhombo and Daniel Terblanche have accused the Department of Public Enterprises (DPE) of interfering and undermining their efforts to restructure the airline.

The rescuers claimed it was not their intention to file for liquidation, but they had no choice after the government failed to co-operate and give confidence to creditors.

The DPE, however, refuted these allegations, and said the rescuers’ plan did not meet the basic requirements as it lacked a credible business case.

SA Express suspended its operations on March 18, until further notice.

This was in light of adverse recent developments, including the impact of the coronavirus pandemic on the aviation sector.

This resulted in SA Express scrambling to pay March salaries and asking for help from the Unemployment Insurance Fund, despite not having made employee contributions since it was placed under business rescue.

BUSINESS REPORT 

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