SAA is so bankrupt that its creditors may well end up having to pay in, if it goes into liquidation.
This is according to Les Matuson, SAA’s business rescue practitioner.
He told a large group of SAA’s creditors on Friday that he believed business rescue – rather than liquidation – was the only option.
To add to the airline’s long list of problems, the International Air Transport Association (Iata) wants a guarantee of €60 million (R950 million) by the end of the month, or it will kick the airline out, City Press’ sister publication, Rapport, has learnt.
Neither Iata nor Matuson would confirm this.
Iata manages the payment system that facilitates airline payments and revenues worldwide, and membership is therefore critical for SAA to survive.
On Friday, Matuson told creditors that auditing firm PwC did make a high-level review of SAA’s finances.
And, he said, after holding consultations with government, unions, Iata, financiers and legal advisers, he believed that it would be possible to save the airline.
It was PwC’s study that showed how disastrous a liquidation process could be.
“SAA leases most of its aircraft,” Matuson said, which means there are few assets.
According to him, these assets would not even cover the claims of the preferential creditors.
“If you register a claim, you may be expected to contribute to costs,” he warned creditors.
None of the creditors present objected to the continuation of the business rescue process.
Even the scant figures provided to creditors made it clear just how grim SAA’s situation is.
SAA last published financial statements in 2017. Since then, its finances have been kept a closely guarded secret.
- According to the latest documentation, SAA owes third parties about R20.4 billion. In 2017, the airline owned assets of just R15.6 billion.
- According to the latest statements - up to March 2017 - SAA still had a turnover of R30.7 billion. But the new documentation, which was made available to creditors, shows that the annual turnover has plummeted to R23.8 billion.
- Even though Vuyani Jarana, the airline’s former chief executive officer, told MPs he was committed to reducing personnel numbers, this initiative seemingly bore little fruit. According to the 2017 annual report, SAA had 5 752 employees. The new documents show that there are currently 5 421 employees.
