The government has agreed to fund a restructuring of South African Airways (SAA) if a business rescue plan for the struggling state-owned airline is adopted, a copy of a draft plan seen by Reuters states.
SAA entered business rescue – a local form of bankruptcy protection – in December, after which administrators took over the running of the airline and have been working on a plan to save the business.
The draft plan said the government had agreed to make a working capital injection, which the administrators estimated at not less than R2 billion, fund employee layoffs, which could cost up to R2 billion, and make an allocation of at least R600 million towards the repayment of general concurrent creditors.
A spokesperson for the administrators confirmed the draft plan was genuine.
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