South African government did not agree with SAA rescue plan
South African finance minister Tito Mboweni says the government has not committed to fund the new South African Airways (SAA) rescue plan.
A court paper obtained by Reuters contains Mr. Mboweni’s statement that no definitive decisions on the sourcing of funds for SAA have been taken. It also details several options for acquiring the money, including investments of pension funds, obtaining it from interested private equity partners or other strategic partners.
Rescue plan was approved by creditors on July 14, 2020. It included a requirement of at least 10 billion rand ($596 million) needed to restructure the national carrier which has not made profit since 2011 and has been put under bankruptcy protection in December 2019.
On July 16, South African Department of Public Enterprises proclaimed that the National Treasury had committed the necessary amount of money, a move contradicted by the Mr. Mboweni’s statement.
It is not the first time SAA’s restructuring plan fails, as the last time its implementation was stopped by company-wide strikes.
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