SA Airways has asked the government for recapitalisation of about R6 billion to fund operational costs, growth strategy and fleet renewal, according to a report
The requested funds would be in addition to the R1.3bn subordinated loan SAA already had from the government, Business Day reported.
It also included the company’s R1.6bn “going concern” guarantee it obtained to underpin its money requirements after the Auditor General raised concerns last year about its ability to generate cash to fund operations.
“This year we will have to go through the same process and the guarantee required will probably be higher,” SAA chief financial officer Wolf Meyer was quoted as telling Parliament’s public enterprises committee on Tuesday.
Meyer said SAA’s weak balance sheet would also have to be fixed if it was going to finance growth and fleet renewal, the newspaper reported.
Since the 2004/05 financial year, the government has bailed out SAA to the tune of R16.8bn.
The bailouts for SAA over the past five years have come either as cash injections or loans guaranteed by the state.
The history of the bailouts showed that every year the state was paying a fortune to keep SAA afloat — 2004/05 R6.1bn, 2005/06 R2.4bn (conversion of loans to equity), 2006/07 R1.3bn (loan guarantees), 2007/08 R5.4bn, and 2008/09 R1.6bn.
Business Day quoted then Treasury director general Lesetja Kganyago in 2009 as likening SAA to a drunk who pretended to reform, only to return to the pub once money was in hand.
Meanwhile, SAA has gone to court in an attempt to recover the R30.8 million former CEO Khaya Ngqula allegedly misspent while he was with the airline.
After a five-year tenure, Ngqula left SAA in March 2009 with a golden handshake of R8.9m, which he was made to repay.
The SAA board is seeking to recover R27m from Ngqula, which he allegedly spent on sign-on retention bonuses to company employees, in excess of the authority given to him.
The company wanted to recover another R3.3m for his hiring of hospitality suites in various sports stadiums, and at least R500,000 he allegedly spent on junkets for his friends.
SAA wants billions from government
SA Airways has asked the government for recapitalisation of about R6 billion to fund operational costs, growth strategy and fleet renewal, according to a report
The requested funds would be in addition to the R1.3bn subordinated loan SAA already had from the government, Business Day reported.
It also included the company’s R1.6bn “going concern” guarantee it obtained to underpin its money requirements after the Auditor General raised concerns last year about its ability to generate cash to fund operations.
“This year we will have to go through the same process and the guarantee required will probably be higher,” SAA chief financial officer Wolf Meyer was quoted as telling Parliament’s public enterprises committee on Tuesday.
Meyer said SAA’s weak balance sheet would also have to be fixed if it was going to finance growth and fleet renewal, the newspaper reported.
Since the 2004/05 financial year, the government has bailed out SAA to the tune of R16.8bn.
The bailouts for SAA over the past five years have come either as cash injections or loans guaranteed by the state.
The history of the bailouts showed that every year the state was paying a fortune to keep SAA afloat — 2004/05 R6.1bn, 2005/06 R2.4bn (conversion of loans to equity), 2006/07 R1.3bn (loan guarantees), 2007/08 R5.4bn, and 2008/09 R1.6bn.
Business Day quoted then Treasury director general Lesetja Kganyago in 2009 as likening SAA to a drunk who pretended to reform, only to return to the pub once money was in hand.
Meanwhile, SAA has gone to court in an attempt to recover the R30.8 million former CEO Khaya Ngqula allegedly misspent while he was with the airline.
After a five-year tenure, Ngqula left SAA in March 2009 with a golden handshake of R8.9m, which he was made to repay.
The SAA board is seeking to recover R27m from Ngqula, which he allegedly spent on sign-on retention bonuses to company employees, in excess of the authority given to him.
The company wanted to recover another R3.3m for his hiring of hospitality suites in various sports stadiums, and at least R500,000 he allegedly spent on junkets for his friends.
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