[ad_1]
An attack helicopter known as the Red Hawk and a series of missiles, artillery and drones are products that Denel SOC Ltd, which has its roots in the arms company created by South Africa to circumvent sanctions during apartheid, is trying to save while struggles to stay afloat.
The state company is seeking equity partners for various units, including the one that makes the Rooivalk helicopter, or Red Falcon, and says it has received several expressions of interest from local and foreign defense companies.
Denel has been unable to pay salaries in recent months and is seeking financial support from the cash-strapped South African government. It has decided to retain five core divisions to protect the country’s “sovereignty” while getting rid of others, including a unit that can produce satellites and a mine clearance operation.
“Denel is looking for strategic equity partners,” the company said in response to inquiries, Denel said.
The company is “confident that the strategic capital partnerships will provide the necessary capital injections and technology and further strengthen its relationship with the South African National Defense Force by maintaining a significant and sovereign capability.”
Reflected privatization
Denel’s plight is reflected in other government-owned companies, from the national power company to the state airline, which were plagued by mismanagement and corruption during the nine-year rule of President Jacob Zuma, who was ousted by his party. in 2018.
While unions and the ruling African National Congress have opposed the privatization of state assets in the past, several companies are now seeking partnerships because the government can no longer afford to bail them out.
Denel parted ways with Armscor in 1992 and has seen the defense budget compete with social needs such as housing and health in the post-apartheid era. The company did not receive any additional money in an interim budget on October 28, while South African Airways did.
“We are committed to our shareholder, the Ministry of Public Companies, on the financial and strategic support necessary for the stabilization of Denel,” the company said. “We have requested funding from the Department of Defense for the maintenance of strategic and sovereign capabilities.”
Read: Denel needs money and warns about South Africa’s ability to defend itself
[ad_2]
