JOHANNESBURG - National carrier South African Airways said on Friday it was now officially under business rescue, a day after announcing that its board of directors had made the decision after consultations with the government as shareholder, in an effort to find a solution to its financial problems.
"The board of directors of SAA has announced that the notice of commencement of business rescue proceedings was filed with the Companies and Intellectual Property Commission (CIPC) on 5 December," it said in a statement.
"The company is officially in business rescue. The CIPC has processed the appointment of the business rescue practitioner, Mr Les Matuson from Matuson Associates in South African Airways' voluntary business rescue process."
On Thursday, public enterprises minister Pravin Gordhan said business rescue would allow SAA to continue operating in an orderly and safe manner and keep planes and passengers flying.
He said existing lenders would provide R2 billion as post commencement finance (PCF) guaranteed by the government and repayable out of future budget appropriations in order for the business rescue process to commence and enable SAA to continue operating. The government would provide an additional R2 billion of PCF in "a fiscally neutral manner".