‘Govt considering independent SAA board, like Telkom’

The ailing airline has been in a form of bankruptcy protection since December.

FILE: Public Enterprises Minister Pravin Gordhan. Picture: Eyewitness News.

JOHANNESBURG - Public Enterprises Minister Pravin Gordhan said government would consider an independent South African Airways board (SAA) with a shareholder structure similar to that of part state-owned Telkom.

The ailing airline has been in a form of bankruptcy protection since December.

Its creditors approved a controversial rescue plan last week that involves scaling down its fleet, retrenchments and a commitment of over R10 billion from the government.

Speaking on eNCA on Sunday, Gordhan described telecommunications company Telkom an interesting model that they could look at as they go forward.

Gordhan added that the new SAA would not be run by a what he called a “bunch of amateurs”.

He said government was trying to secure the R10 billion required for the business rescue plan to succeed.

State-owned SAA, which last made a profit in 2011, entered bankruptcy protection in December and suspended commercial passenger flights in March when the government imposed one of the world’s strictest lockdowns to contain the new coronavirus.

Fierce wrangling between the airline’s administrators, the government and trade unions has complicated rescue efforts, which delayed the publication of a restructuring plan until last month.

That plan envisages scaling back the airline’s fleet and shedding jobs before gradually ramping up operations as the disruption caused by COVID-19 eases.

It is not yet clear where funding will come from, after the finance minister allocated no new money to SAA in an emergency budget. The government says it has been talking to investors and potential partners but has given few details.

Additional reporting by Reuters.