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Gordhan: SAA business rescue practitioners have final say on airline's restructure

27th February 2020

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South African Airways (SAA) business rescue practitioners have the final say on a plan to restructure the embattled airline and government will respect that authority, Public Enterprises Minister Pravin Gordhan has said.

Gordhan was speaking at News24's Frontline post-Budget panel discussion on Thursday morning.

SAA was placed under business rescue in December 2019. In early February its business rescue practitioners, Les Matuson and Siviwe Dongwana, cancelled dozens of routes in a bid to save cash.

President Cyril Ramaphosa said at the time he was unhappy with the cancellations. Later in the month government secured a R3.5-billion loan from the Development Bank of Southern Africa to prevent the national airline from being liquidated. Gordhan, meanwhile, has previously warned that this funding may run dry by March.

Matuson and Dongwana, meanwhile, are set to publish their rescue plan by the end of February.

When asked on Thursday if government would accept what the business rescue practitioners propose, Gordhan said the practitioners have the authority.

"It's the business rescue practitioner's plan. We have no authority. We have a view, but it would be stupid to put forward a view that would lead to another collapse," he said.

During his Budget speech on Wednesday, Finance Minister Tito Mboweni announced that Eskom and SAA would receive a budget allocation of R60.1-billion over the next three years.

SAA has been allocated R16.4-billion. Of this, R11.2-billion is for the airline's debt servicing costs, according to Gordhan. "What the budget is saying, is that it is time to repay that debt and minimise the interest costs of that debt".

Edited by News24Wire

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