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Government vows to give funding to SAA

SAA

Government has assured SAA rescue practitioners that it will provide the necessary funding to the state-owned airline.

In a statement, the Department of Public Enterprises said “government will re-prioritise funds to finalise the restructuring of South African Airways (SAA) and the implementation of the airline’s business rescue plan”.

The national carrier will not be liquidated,” the department said in a statement shortly after a meeting of the airline’s creditors and business rescue practitioners.

In July, creditors of cash-strapped SAA approved a mass restructuring plan that would replace it with a new, restructured and competitive carrier.

South Africa Airways (SAA)

Earlier on Friday, the airline’s business rescue practitioners told creditors that government had stated a “very clear cabinet commitment” to make available R10.5-billion to restructure the airline.

But the Public Enterprises Department says in the next few weeks, lending institutions will be asked to finance the restructuring and honour commitments for voluntary severance packages and retrenchments.

Unions have written to the government, threatening legal action if SAA and SA Express are liquidated.

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Source: eNCA