South African Airways to restructure under ‘business rescue’
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
South African Airways, the country’s beleaguered flag carrier, has entered into a new phase of government rescue.
The airline has received a new government-backed cash infusion of 2 billion rand (about $137 million) from its existing lenders, the latest in a series of government bailouts the struggling company has received in recent years.
The South African treasury matched that loan as part of the government’s business rescue plan for the airline.
Pravin Gordhan, South Africa’s public enterprises minister, announced the plan in a statement Friday.
“Our desire is that the restructured airline will mark the beginning of a new era in South African aviation,” the statement read in part. “It is also important that the reliance on government finances be reduced as soon as possible to minimize disruption to SAA services, customers, staff and other stakeholders.”
Under the plan, a “business rescue practitioner” will take control of the airline and help restructure the company, attempting to stabilize its operations and finances. South African expects to continue flying normally as it restructures.
“This set of actions should provide confidence to customers of SAA to continue to use the airline because there will not be any unplanned stoppages of flights or cancellation of flights without proper notice should that be necessary,” Gordhan’s statement said.
According to Gordhan’s, the company will try to retain as many jobs as possible as the business is reconfigured.
Despite the airline’s financial difficulties, the carrier seems confident in its financial position and has planned to add up to four Airbus A350s to its fleet. Some are already flying on long-haul routes, including to the U.S. The planes represent a significant upgrade to the airline’s onboard product over the old A340s they are replacing.
Featured photo by STEPHANE DE SAKUTIN/AFP/Getty Images.
Welcome to The Points Guy!
WELCOME OFFER: 60,000 Points
TPG'S BONUS VALUATION*: $1,200
CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners
*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.
- Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®
- 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 60,000 points are worth $750 toward travel
- Get unlimited deliveries with a $0 delivery fee and reduced service fees on orders over $12 for a minimum of one year on qualifying food purchases with DashPass, DoorDash's subscription service. Activate by 12/31/21.
- Earn 5X points on Lyft rides through March 2022. That’s 3X points in addition to the 2X points you already earn on travel.