The Companies and Intellectual Property Commission (CIPC) has appointed a business rescue practitioner for State-owned South African Airways (SAA), the airline announced on Friday. He is Les Matuson from Matuson Associates. “The company is officially in business rescue,” stated SAA in its press release.
“Time is of the essence,” warned Turnaround Management Association of Southern Africa chapter president and board chairman Alastair Macduff on Thursday. “A timeous turnaround of the business is in the interest of all involved and in the interest of all South Africans.”
Also on Thursday, Department of Public Enterprises deputy-director general Advocate Melanchton Makobe effectively confirmed that SAA would be restructured, as a result of going into business rescue. “That business rescue plan is, in effect, a restructuring plan for the airline,” he said. “It will mean looking at the airline – which routes to operate, which routes not to operate.”
Earlier on Thursday, lawyers for the Solidarity trade union, the Minister of Public Enterprises, the Minister of Finance, and SAA, in a meeting with the Deputy Judge President of the South Gauteng High Court, had all agreed that SAA was now under business rescue. The union, on November 21, had launched a court application to have SAA placed in business rescue.
At the meeting, SAA agreed to ratify a resolution with the CIPC to the effect that the airline be, that same day, voluntarily placed in business rescue. “This is a historic event,” highlighted union CEO Dr Dirk Hermann on Thursday. “It is the first time that a public enterprise is placed under business rescue. The business rescue process also shows that mismanagement and plundering actually do have an end date – in this case at great cost.”
“However, this is not a voluntary business rescue process; it was enforced by Solidarity’s application,” he pointed out. “The government is now trying to obtain more control over a process they had been opposed to in the past.”