JOHANNESBURG, Sept 17 — Administrators at struggling South African Airways (SAA) have called creditors to a meeting today after the government missed a deadline to make funding available for a restructuring plan.
The administrators took control of state-owned SAA in December after almost a decade of financial losses and published a rescue plan in June following repeated delays and wrangling over its future.
But the plan, which envisages scaling back SAA's fleet and cutting jobs, needs at least 10 billion rand (RM2.52 billion) in new funds to work, and the cash has not materialised despite assurances from the government.
Of the more than 10 billion rand needed, around 2.8 billion is required for initial working capital including restart costs.
Friday's creditor meeting will be convened at 11 local time (0900 GMT) to discuss the funding issue and the proposed future of the company, the administrators said.
The Department of Public Enterprises, the ministry responsible for SAA, said yesterday that it was still trying to source the necessary funding and that it was assessing proposals from several potential strategic equity partners.
SAA has not flown commercial passenger flights since March, when South Africa entered one of the strictest lockdowns in the world to contain the spread of the coronavirus.
Separately, two of SAA's largest unions, Numsa and Sacca, said they would picket outside SAA offices today to demand that the government makes funding available.
“Government is the shareholder of this airline and as such it has a duty to ensure that the airline is viable and to protect jobs, as promised,” the unions said in a statement. — Reuters