DPE and SAA rescue practitioners agree to work together

The two parties signed an MOU which does not allow the BRPs to sell SAA’s assets without government involvement.
The road to a new national carrier continues. Image: Waldo Swiegers/Bloomberg

A memorandum of understanding between the Department of Public Enterprises and South African Airways’ (SAA’s) business rescue practitioners (BRPs) have put a freeze on the unilateral sale of the airline’s assets at least until June 30. 

In the document seen by Moneyweb, the two parties commit to a ‘defined interim period’ where the department will be given an opportunity to formulate proposals that will go into the final business rescue plan, either for a restructured SAA or the new airline. 

During this period which, at the latest ends on June 30, the BRPs and the department agreed that there will be “no sale of assets nor negotiations in this regard without consultation with and the involvement of the department”. 

The two parties also agree to work together in the development of the rescue plan, that the objective of the process should be a restructured new airline and that as many jobs as possible should be saved. 

Three workstreams will be established in the work towards a new or restructured airline.

  • The financial workstream will be responsible for determining how much money is still available at SAA and what will be needed to ensure the continued operation of SAA until June 30. 
  • An asset workstream will determine what assets will be needed in the new national carrier.
  • The workstream for labour aims to streamline the retrenchment process initiated by the BRPs and the parallel compact that government and labour entered into. 

Read: SAA: Government and labour agree to work towards new airline

The agreement follows discussions with the BRPs following DPE Minster Pravin Gordhan’s presentation in a joint parliamentary meeting last week, where he criticised the practitioners for only delivering an “outline” of a business rescue plan in the five months since the process started. He also questioned the way that Les Matuson and Siviwe Dongwana spent the R5.5 billion in post-commencement funding, stating that not enough was done to realise savings. 

Read: How was R5.5bn spent by SAA BRPs? Gordhan wants answers

The BRPs have said that without further government funding the only options left were a careful wind-down of the business or liquidation. In the wind-down option, all workers would need to accept a severance package agreement that would be founded through the sale of selected assets. 

Speaking to the committee, Gordhan said there would be no “fire sale of assets” or liquidation of the airline when there are many alternatives which could still be pursued. 

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Talk about a new or restructured airline. Not worth reading. This SAA saga is like a guy with constipation.

so R10bn on its way

Use the R10bn to pay off the 40,000 staff. Workers will be happy, taxpayers will not be too pleased (no more future bailouts), PG will be happy.

“Three workstreams will be established to work towards a new or a restructured airline. First, the financial workstream will be responsible for determining how much money is still available at SAA.” Well if you haven’t been able to submit audited annual financial statements for the last three years, you are not going to know what’s going on in your finances. In fact, it is anybody’s guess.

On and On and On we go.

The only country in the world trying to start an airline when the rest of the world is closing them.

Pravin Gupta should be fired.

He is as pathetic as Patel. An insult to South Africans. Give him a Bloomberg exposure

is it that difficult to find that “off switch “??

A lifeline for the gravy train. Rescue oxygen and a ventilator agreed upon for the deceased. Is there no other way to dip into the till without arising suspicion? I guess not any more.

SAA and Gov long game here is to shut down all the other airlines and have the monopoly again. Easy to do, stop all others flying, keep a tax payer rand stream running to keep SAA going till there is hard evidence of the others death. then put all the junk of SAA in one company and the peaches in another. Fund the other to fly and liquidate the junk.

They managed to kill 1 Time, and tried via SACAA illegally to kill CemAir. Have they paid Comair the money owed??

I think they owe Comair around R750m which makes Comair a major creditor. The Pravin circus not surprising really, look what he did to screw Eskom last year to appease the unions. Trying the same nonesense again!

And where will the revenue come from with no aircraft in the air?

What is it they they just cannot fathom about the world at the moment?

What is worth trying to rescue in SAA?

ANC free flights for life.

MP,s and their extended families Free Trips :

I suppose they just couldn’t spell ‘euthanasia’

The siphoning continues, just through another layer!

Ten years after the last plane has been sold/ mothballed the SA taxpayer will still be paying towards Business rescue practitioners, Lawyers, Court appearances, contracts, etc, etc!

We need David Copperfield to just make SAA go “poof” into thin air on its last flight, right in full sight of the Pharmacist!

The ANC don’t give a, in this case, FLYING f—!!!

Does this insanity never end ? This calls for a total tax boycott.

Why sid govt then appoint business rescue practitioners? Kicked the can down the road to buy time…..Edcon BRP will be a carbon copy of this sham.

End of comments.

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