South African Airways (SAA) has put up nine of its Airbus aircraft and 15 spare engines for sale. That’s according to a tender document seeking proposals from interested buyers. The airline might be forced to suspend some flights and delay salary payments if the government doesn’t come up with a plan soon to provide the R2 billion it promised the airline last month.
SAA was placed under business rescue last month in an effort to save the company and 10 000 jobs. Government promised the airline R2 billion and another R2 billion was to come from lenders.
Specialists appointed to turnaround the national carrier say government has not yet provided its portion of the funds and the R2 billion from lenders has been exhausted.
Chantal Marx, from FNB Wealth and Investment, explains the sales, “With regards to the sale of the airplanes, that is part of the business rescue process whereby they are just trying to strengthen the balance sheet a little bit. The company is absolutely drowning in debt and selling aeroplanes and parts is probably a smart way to remove some of the debt from the balance sheet, to bring some cash into the business and put it in a healthier position,” explains Marx.
Watch related video below:
Source: SABC News (sabcnews.com)