Vote on SAA’s business rescue plan postponed to July
The business rescue practitioners’, who took over SAA in December, published their restructuring plan last week and expected the vote to take place on 14 July.
JOHANNESBURG - A vote on a restructuring plan for South African Airways (SAA) on Thursday was delayed until next month after creditors and trade unions secured an adjournment.
The business rescue practitioners’ (BRPs), who took over SAA in December after almost a decade of financial losses, published their restructuring plan last week and now expect the vote to take place on 14 July.
The business rescue plan for SAA involved scaling back its fleet while keeping most routes intact, but it needs the government to find at least R10 billion to pay some creditors, fund retrenchments, and restart the airline as COVID-19 travel restrictions ease.
It is not clear where the funds will come from, with Finance Minister Tito Mboweni allocating no new funds during his supplementary budget speech this week.
The National Union of Metal Workers of South Africa (Numsa), the South African Cabin Crew Association (Sacca), and the South African Airways Pilots’ Association (Saapa) on Thursday said that the adjournment was necessary to correct what they said were deficiencies in the plan, as well as for further negotiations.
Some creditors, including SA Airlink - which tried this week to block the meeting via the courts - argued that the BRPs had not complied with local companies’ law and had not provided creditors with key information.
But the BRPs said they had responded to the creditors’ concerns.
However, even if SAA’s creditors approved the plan next month, it could still be reworked if the government does not come up with the necessary funding.