SAA receives much-anticipated R5bn guarantee
3 October 2012
(Engineering News) - The South African government confirmed on Tuesday that a much-anticipated, and highly controversial, R5-billion guarantee had been extended to South African Airways (SAA) for a period of two years, starting from September 1.
In a joint statement, the National Treasury and the Department of Public Enterprises (DPE) said the guarantee would be premised on a turnaround strategy to be approved by the Public Enterprises Minister Malusi Gigaba in concurrence with Finance Minister Pravin Gordhan.
“This will include SAA providing the DPE and Minister of Finance with the financing strategy for its planned purchase of a short- and long-haul fleet.”
The guarantee would enable the national carrier to borrow from the financial markets to ensure its viability as a going concern.