SAA mulls selling assets amid near crippling debt - report

Reports suggest SAA needs R21.7 billion, this includes a R12.1 billion government bailout.

FILE: An SAA aircraft. Picture: AFP

JOHANNESBURG - Questions are now being asked about South African Airways (SAA) after a report claiming that it’s considering selling off its assets following the decision by banks to refuse to give the national carrier any more money.

The City Press is reporting that due to SAA’s ballooning debt, it will be working with the state to gain funding until 2021.

Reports suggest SAA needs R21.7 billion, this includes a R12.1 billion government bailout.

Last week, Public Enterprises Minister Pravin Gordhan announced that SAA, along with SA Express and arms-maker Denel, would not have their annual reports and financial statements tabled on time to present to Parliament.

SAA is expected to require billions in public funds as it tries to make the long haul into financial health.

The City Press is reporting that SAA, which faces almost crippling debt, will be looking at several aggressive cost-cutting measures.

Some of these measures reportedly include selling off its catering arm “air chefs” and outsourcing or selling SAA cargo.

The paper says in the meantime, the carrier will turn its appeals towards the government for further bailouts.

SAA CEO Vuyani Jarana earlier in 2018 announced a strategic plan to turn the carrier around, saying layoffs and other cuts were unavoidable.

SAA says it will soon be addressing the public on the progress the carrier has made in transforming the situation.

(Edited by Zamangwane Shange)