Government Looking For R2bn To Save SAA

Government is looking for R2bn to contribute to SA Airways (SAA), as part of its commitment to the airline’s business rescue process. 

Meanwhile, the department of public enterprises said in a statement on Sunday evening that it was working with National Treasury to raise funds to save SAA.

“We are determined to contribute to the business rescue process so that we could minimise job losses and give birth to a rejuvenated SAA that all South Africans could be proud of.

“Collective effort is needed to make SAA  a premier African airline and Star Alliance member,” it said.

The SAA board last month adopted a resolution to place the airline into business rescue, hoping to facilitate the rehabilitation of the financially distressed company.

At the time, public enterprises minister Pravin Gordhan said R4bn was needed for the operation, withgovernment and creditors jointly committed to the process as post-commencement finance (PCF).

The department said it was determined to break the past patterns of “bailouts”, as these had become“moral hazards”.

“It is a decisive move that demonstrates that government will undertake the necessary bold steps to reposition its assets in such a way that they do not continue to depend on the fiscus and thereby burden taxpayers.

“The creation of a sustainable, competitive and efficient airline with a strategic equity partner remains the objective of government through this exercise,” it said.


Written by How South Africa

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