SAA rescuers claim to have saved 36 billion rand
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Johannesburg – Ailing SAA’s Business Rescue Practitioners (BRPs) have defended the R200million process to rescue the national carrier, claiming they have reduced the airline’s liabilities by nearly R36 billion .
SAA BRPs Siviwe Dongwana and Les Matuson have informed those affected by the corporate bailout process that they believe they have served their purpose despite the airline cutting around 3,700 jobs.
According to Dongwana and Matuson, the SAA workforce has been reduced from 4,700 to around 1,000 through voluntary service packages and layoffs.
The BRPs said the main achievement of the company’s rescue process was to transform SAA from an insolvent company to a company that is both solvent and liquid.
“To this end, the airline’s liabilities have been reduced by R35.7 billion as a result of the compromise negotiated by the BRPs with competing creditors and lessors,” Dongwana and Matuson said.
SAA’s liabilities and claims for damages fell from R38 billion before the company’s bailout process to R2.3 billion due to compromises negotiated with creditors and lessors.
Dongwana and Matuson say they have reduced SAA’s overhead costs by negotiating value-for-money contracts with vendors and preserving its infrastructure and other assets.
In January, Pretoria News reported that the costs of the corporate bailout process had risen to exceed R200 million, with Dongwana and Matuson receiving R59 million.
Last week, The Sunday Independent reported that SAA assured the Companies Court of the Companies and Intellectual Property Commission that the corporate bailout process would end on March 31.
Dongwana and Matuson also revealed that SAA’s board and management are working on a plan to restart and resume operations of a restructured national carrier.
Deputy Minister of Public Enterprises Phumulo Masualle this week assured the country that SAA’s strategic partner would be announced within a month, paving the way for a restructured national carrier.
Almost 700 employees have been placed in the restructured airline under revised terms and conditions.
The BRPs said SAA received funding to resume operations after the airline was grounded a year ago, three months after it was placed in a corporate bailout in December 2019.
Outstanding issues that will allow Dongwana and Matuson to issue a notice of substantial implementation of the corporate bailout include paying employees – at a minimum – their unpaid wages or making provision for it.
SAA still has to pay some of its creditors.
However, the end of the corporate bailout drew near this week when the BRPs informed creditors that they were appointing Dongwana and Bongani Nkasana as receivers. Receivership is the process following the discharge of an entity from rescuing a business.
The responsibilities of Dongwana and Nkasana as receiver will include receiving the proceeds from the restructuring process and paying creditors, lessors and lenders, among others.
SAA creditors had until yesterday to decide on the appointment of Dongwana and Nkasana.
The two proposed receivers were considered to have an intimate knowledge of SAA business and the requisite receivership know-how and expertise.
The R2,000 per hour receivers will also have the power to investigate the affairs, affairs, property and financial condition of the SAA.