On July 14, local time, the South African Government Department of Public Enterprise (DPE) announced that after the creditors voted, it would not use liquidation, but instead adopted a business rescue plan to restructure South African Airlines restructures and returns to the blue sky.
The South African Government’s Ministry of Public Enterprise stated that 86% of creditors voted for the airline’s business rescue plan at the South African Aviation Business Rescue Conference. The Ministry of Public Enterprise believes that for creditors and South African Airways employees, the rescue is a better result than liquidation, and the government believes that the implementation of commercial rescue will balance the interests of all parties.
The South African Government Department of Public Enterprises stated that the government will appoint a new South African Airways Board of Directors. The interim chief executive officer will be Phillip Saunders, an airline executive with certain business background and experience. He will work closely with the interim board of directors to appoint an interim management team The team must implement a comprehensive restructuring of South African Airways led by a new interim board.
The government will mobilize the necessary resources to fund the transition. This includes the voluntary severance payment plan (VSP) reached with the trade union and complies with the requirements of the Labor Relations Law and the Basic Employment Conditions Law. The government hopes that the new South African Airlines will be able to regain its original market share and seize space in emerging markets in the face of the epidemic challenge and change the previous loss situation.
