SAA hopeful business rescue will accelerate proposed radical restructuring
While the airline said the losses incurred during the strike were not the only factor contributing to this latest decision it did speed up the process.
JOHANNESBURG - South African Airways (SAA) on Thursday said the board’s decision to place the ailing airline under business rescue may result in the acceleration of its proposed radical restructuring process, leading to job losses.
The National Union of Metalworkers of South Africa and the South African Cabin Crew Association went on an eight-day day strike two weeks ago against the restructuring process, the work stoppage cost the airline an estimated R50 million a day.
The airline said the losses incurred during the strike were not the only factors contributing to this latest decision, however, the strike did have an impact on operations.
SAA’s Martin Kingston said the future of the national carrier was now solely in the hands of a business practitioner, with the board and shareholders no longer having a say in its affairs.
“I suspect when the business rescue practitioner has applied his mind, they will wish to accelerate that process as well without any consequences for the staff and their families.”
Solidarity’s Dirk Herman said entering business rescue was the only option available to avert complete disaster.
The process should result in SAA receiving about R4 billion in finance from existing lenders and Treasury, but government has stressed that this is not a taxpayer bailout.