South African Airways to Receive 1 Billion from Government.

Finance Minister for South Africa, Enoch Godongwana, announced that 1 billion South African rands, which is about US$55.5 million, will be made available to South African Airways (SAA). The money will be used to settle a portion of the outstanding obligations on the implementation of SAA’s 2020 Business Rescue Plan.

SAA will be able to cover outstanding liabilities, specifically those relating to the final dividend payment to creditors and the refund of legacy un-flown tickets to affected passengers which date back to the period when SAA was placed in business rescue in December 2019.

The Chief Financial Officer, Fikile Mhlontlo, said, “SAA has reached a point where we cover our operating costs. It must be emphasised that the allocation announced relates only to historical debt. These funds are not meant to bolster the business plan we are currently executing.”

It is important to note that SAA current debt stands at 3.5 billion rands (about US$191 million), which means their debt will only be reduced to 2.5 billion rands (about US$135.5 million).