SAA rescuers get extra month to make plan

The extension is to allow committees representing SAA employees and creditors to give feedback on a draft version of the plan.
Image: Shutterstock

Administrators for South Africa’s loss-making state airline have been given an extra month to complete a turnaround plan.

The so-called Business Rescue Practitioners can now file their report on South African Airways by the end of March, they said in a statement on Friday. A majority of creditors agreed to the extension. Bloomberg News earlier reported the development.

South Africa’s government placed SAA into a local form of bankruptcy protection late last year, a move designed to end a cycle of state bailouts and mounting losses. The National Treasury increased the amount of funding available to the carrier to R16.4 billion ($1 billion) earlier this week to help service debt while the administrators complete their task.

The extension is to allow committees representing SAA employees and creditors to give feedback on a draft version of the plan, while the Department of Public Enterprises will also be given an opportunity to comment, the administrators said. A final version will then be published and voted on by lenders.

“We believe that a further extension of one month will allow for sufficient time for us to finalize the draft plan, given the complexity and extent of engagement that is required in a business of this size,” the rescue practitioners said.

To date, the rescue team led by Johannesburg-based Matuson & Associates have cut several international and domestic routes while serving notice to labour groups that job cuts may be inevitable. Finance Minister Tito Mboweni on Wednesday reiterated that the government’s aim is to turn SAA into “a sustainable airline that is not a burden to the fiscus,” rather than close it down.

© 2020 Bloomberg

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

COMMENTS   4

You must be signed in to comment.

SIGN IN SIGN UP

This is just a big expensive ANC CON.

SAA have a ‘Plan’? Eskom also have a ‘Plan’. Lot’s off ‘Plans’ floating around.

BRP’s still utilising same inept management team for strategy in the turn around plan that landed the company in the situation it finds itself in.
No wonder they can’t formulate a plan.

Close it down x 1 000 000 000

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR

Podcasts

NEWSLETTERS WEB APP SHOP PORTFOLIO TOOL TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: