The joint business rescue practitioners (BRPs) for financially-embattled State-owned national flag carrier South African Airways (SAA) reported on Thursday that the government had failed to supply the funding it had promised to finance the implementation of the airline’s business rescue plan. Consequently, the BRPs had called a meeting of SAA’s creditors from 11h00 on Friday.
“The BRPs hereby advise affected persons that the anticipated funding has not been received by the company in accordance with the commitment from government to provide the funding for the restructuring of the company and the implementation of its business rescue plan,” said the BRPs in their statement. At the Friday meeting the proposed future of SAA would be discussed, “taking into account all relevant factors”.
In their previous update on the business rescue process, the BRPs had pointed out that the implementation of the rescue plan required short-, medium-, and long-term funding. Concerning the short-term funding, the government had already provided R9.3-billion to pay SAA’s creditors.
But more was required and, at that time (September 10), the government had committed itself to supplying the rest of the necessary funding within seven days. It is this funding that the government has failed to provide.
In their September 10 statement, the BRPs had reported that the airline’s funds for operational expenditure were “near depletion” and that SAA was in a “dire financial position.” In their latest statement, the BRPs said that during the Friday meeting they would “provide an update on the status of the financial position of SAA and the circumstances presently prevailing”.