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Bloomberg reports that the Department of Public Enterprises (DPE) and trade unions are working together on a business model for a new national carrier that will replace the embattled SA Airways (SAA).
The new airline will be funded through a variety of options such as strategic equity partners, funders and the sale of non-core assets, the DPE said in a statement Wednesday. The parties are still of the view that the state must continue to play a role. The business rescue practitioners (BRPs) running SAA had proposed firing the entire workforce to stave off liquidation after a request for state funding was rejected in April. However, DPE Minister Pravin Gordhan strongly objected to that plan and announced his ambitions for the creation of a new airline. “It is essential to build a leadership coalition which is robust and strong enough to find solutions, and establish the foundations of a new airline with a growth path,” the DPE said on Wednesday. The BRPs are now proposing the government provide a R21 billion bailout to help repay debt and resume operations after the lifting of Covid-19 travel bans.
- Read the original of the above report by Rene Vollgraaff at Moneyweb
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