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South African Airways in talks over funding for shake-up

Public Enterprises ministry says it is pursing various options to save the airline.
Minister of Public Enterprises Pravin Gordhan. Image: Moneyweb

South African Airways (SAA) and lenders have had “intense discussions” to secure funds for the cash-strapped carrier’s operational and structural transition, the country’s public enterprises ministry said on Sunday.

Read: SAA’s woes are making travel industry skittish

SAA, which hasn’t made a profit since 2011 and is dependent on government bailouts to remain solvent, was hit last month by a crippling strike that pushed it to the brink of collapse.

The department, headed by minister Pravin Gordhan, issued a statement saying that the struggling state-owned airline could not continue in its present form and would need a “radical restructuring” to ensure financial and operational sustainability.

“Over the past few days there have been intense discussions with lenders to secure the necessary funds to cover the operational and structural transition over the next few months,” the ministry said.

The ministry is pursuing various options to turn around SAA, it added without providing further detail.

SAA last month said it could cut more than 900 jobs as it looks to stem severe financial losses.

Its financial position worsened dramatically after November 15, when two of its largest unions began an eight-day strike over pay that forced SAA to cancel hundreds of flights.

In another blow, two large travel insurers in South Africa on Friday stopped covering SAA tickets against insolvency as doubts grow over whether the airline can survive.

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Now we’ve gone from strategic plans to intense discussions.

A committee to conduct feasibility studies could be next.

This should keep the bailouts flowing for the next couple of years.

Wonder how many times a donkey will actually bump his head.

The official statement mentions” radical restructuring”.
And the only sensible thing that should be done with SAA, is to liquidate it ASAP.

Proof again that the unions have the country by the proverbials… Jamnadas needs to grow a pair and close SAA down once and for all. Surely with no more support from travel agencies there is really no more hope.

Jamnadas is in way over his head. He is simply incapable of fulfilling the role as SOE minister. His thought process is trapped in SACP 1960s thinking ie protection of the ANC voting SOE employee at any cost( but mainly taxpayer cost which translates into less available for the beneficiaries of tax ie the poor) ! He did this to the previous CEO of Eskom prior to the election ie Destroy Eskoms capable leader to buy votes. In short-he is toxic and ultimately incapable-he has to go!

Why not get someone younger and more capable who can execute a desperately needed turnaround strategy?

Expect a bail-out before the end of the week…..

It looks like the goal of Radical Economic Transformation at SAA has been accomplished. Now the ANC needs to find another industry to transform – I know, let’s transform the healthcare industry and try and force Doctors to act like obedient deployed Cadres while billions are siphoned off in shady deals for the connected criminal networks.

Maybe it is time for us the taxpayer to vote with our feet.Avoid flying SAA at all costs.This might explain to the Unions who is paying for their irresponsible behaviour. Maybe the last bit of power we as taxpayers have.

Have been on this for very long, why pay double for a flight tickets…
First via taxes and then by way of a ticket..NOPE, will pay more for a ticket out of Lanseria on the green or maroon planes, saa ( small caps intended) nope…

SO disappointed in the unions, thought they would close the place down on behalf of the citizens of safrica….

Just go to show, when teh uions talk “mother of all strikes, shutting everyone and everything down , yada yada,it is just marketing …

End of comments.





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