Creditors have today approved the business rescue plan (BRP) for South African Airways.
Some 86% of creditors voted to support the BRP, according to South Africa’s Department of Public Enterprises, which includes around $1.6 billion in state funding and the loss of thousands of jobs.
The ministry says that it “applauds creditors and all stakeholders for realising that a new, restructured, competitive airline, born out of the old, is the best option to immediately take back to the skies and preserve the brand of a national carrier”.
The government had urged creditors and unions to support the BRP, saying that the alternative was to liquidate the airline.
SAA’s resurrection involves an initial restart period of eight months, running to January 2021, with around 1,000 jobs being retained and the fleet built up to around 26 aircraft.
The long-suffering carrier was placed into bankruptcy protection in December 2019 and immediately appointed business rescue practitioners. It employed around 4,700 people in March, when the practitioners announced that a consultation was beginning on job cuts.
The public enterprises ministry says its priorities are now to “give effect to funding commitments by the government for the business rescue plan” and to “appoint a new, and reconfigured interim board for SAA”.
It states that SAA is aiming to “reclaim” its market share, but notes ”the impact of the Covid-19 pandemic… will constrain the aviation industry for some time into the future”.
The ministry also announced that Philip Saunders is the airline’s new interim chief executive. Saunders has been chief commercial officer at the carrier since December 2019 – a position he previously held at Kuwait Airways and Air Malta. He was also chief executive of Caribbean Airlines for two years starting in September 2007.