A total of 3 041 of SAA’s nearly 5 000 employees have qualified for voluntary severance packages, but the airline’s business rescue practitioners still await R2,2bn from Government to pay them.
All VSP applications and acceptances were finalised on Friday and Section 189 retrenchments are under way, confirms BRP spokesperson, Louise Brugman. “Section 189s are under way and all 3 041 VSPs were approved. The BRPs now need the money to pay them,” she says. An internal note on the process forward has been issued to all employees. “Staff must now report to the SAA offices to process their exit from the company,” she says.
According to the business rescue plan, only 1 000 staff will remain on new terms and conditions, but another 1 000 will be placed on a temporary training lay-off scheme and will be re-absorbed into the new airline as new positions become available.
Meanwhile, the government says it has been assessing more than 10 unsolicited expressions of interest received by the beginning of August from private-sector funders, private equity investors and partners for SAA and its subsidiaries, Mango, SAA Technical and Air Chefs. Government has appointed Rand Merchant Bank to help assess these expressions of interest.
However, it remains tight-lipped on progress being made in “mobilising” the R5bn immediately required so the BRPs can discharge their duty and hand SAA back to its management and board. The BRPs urgently need R800m to pay post commencement (PCF) creditors; the R2,2bn for the VSPs and Section 189 retrenchments; and R2bn in working capital.
In a statement, DPE says it had been busy assessing interests from unsolicited local and international strategic equity partners as part of the implementation of the business rescue plan. “The DPE believes that such investments in the airline and its subsidiaries will help support key economic sectors, including tourism, and solidify South Africa as an African gateway to international markets. Such partnerships will also improve scale and scope and ensure continuity of value creation to the South African economy and long-term sustainability of the aviation industry managed by competent, competitive and skilled personnel who possess strategic and technical capabilities, which are critical to the success of the new carrier.”
Meanwhile, SAA’s last two A350-900 aircraft were returned to lessor, Air Mauritius, last week, following the return of the other two leased A350s to Teruel, Spain, last month. Louise says this leaves SAA with seven leased aircraft (three A320s being used for the UN World Food Programme; three A319s and one A330), but all leases are to be terminated as soon as possible. She says the BRPs are still struggling to sell SAA’s nine old A340s (five A340-300s and four A340-600s).
Government reportedly aims to relaunch SAA in January.
