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By Staff Reporter 
12h ago
JOHANNESBURG – The South African government has told South African Airways (SAA) administrators that there is a “clear cabinet commitment” to provide the state airline with R10.5 billion ($ 650.7 million) of funding, said one of the administrators on Friday.
The administrator said at a meeting of SAA creditors that the government’s communication had the support of the National Treasury, but that the terms and mechanisms for financing had not yet been finalized.
This comes after SAA convened an urgent creditors meeting yesterday that took place today, as funds for the restructuring of the airline have not been received as expected.
Last Friday, it looked like plans for the new SAA were headed for more turmoil, as business rescue professionals (BRPs) gave the government until this week to fund the rescue process or face liquidation.
SAA rescuers Les Matuson and Siviwe Dongwana warned last Thursday that the government had until this week to determine whether to proceed with the rescue of the airline, as its existing funds were close to being exhausted.
“The remaining portion of the short-term financing required by the company has not yet been made available to the company,” rescuers said.
“The BRPs have tirelessly engaged with the government to ensure that this funding is available to the company on time.”
SAA has been finalizing the termination of 33 of the 40 aircraft leases by the end of September to ensure it does not have excessively onerous and inappropriate contracts.
In terms of the SAA’s rescue plan, the airline needs at least R10 billion in short, medium and long-term funds so that it can get back to the skies.
REUTERS / BUSINESS REPORT
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