SAA Technical issues ultimatum to SAA, Mango - but overseas flights safe, for now
- SAA Technical wants to suspend its services to SAA and Mango due to unpaid debts, which means the airlines won't be able to fly.
- But the spokesperson for SAA's business rescue practitioners say they have been assured that repatriation flights can continue.
- The ultimatum comes just a couple of days before SA opens its borders for international travellers.
- For more articles, go to www.BusinessInsider.co.za.
The aircraft maintenance company SAA Technical has issued an ultimatum to SAA and Mango that it won’t provide them with further services unless their unpaid debts are settled. This means that SAA and Mango won’t be able to fly without the necessary SAAT inspections before take-off.
But Louise Brugman, spokesperson for business rescue practitioners of the airline, Les Matuson and Siviwe Dongwana, says SAAT gave them the reassurance that there won’t be an “immediate suspension” of service.
The ultimatum should not affect SAA repatriation flights over the next few days, she added.
Mango also said that flights should continue throughout the long weekend, but that it is taking part in “key and sensitive discussions” with Mango and SAAT “to continue with operations under these difficult times”.
While Mango and SAAT are SAA subsidiaries, only SAA is current in business rescue.
After government missed the business rescue practitioners' deadline to provide SAA with the R10.5 billion needed to keep the airline from being liquidated, the department of public enterprises is currently negotiating with banks and creditors to provide the money, in what may be bridging finance.
It is understood that Treasury has (reluctantly) agree to find money to bail out the airline, but this will only be made available in coming months after budget re-allocations. The R10.5 billion will be used, in part, to settle the voluntary severance packaged of more than 3,000 of SAA's 5,000 employees. The money may presumably also be used to settle the SAAT unpaid bills.
Over the past decade, SAA received about R30 billion in government bailouts, and it last made a profit in 2011.
The SAAT ultimatum comes just a few days before South Africa opens its borders for international leisure travel, on October 1.
On Friday, Emirates announced it will resume flights between Dubai and Joburg, Cape Town and Durban from that date.
SAAT has seen its own share of controversy over the past year. Last year, local airlines were forced to ground some of their aircraft for compliance checks after irregularities were discovered during an inspection at SAAT.
This came after reports that SAAT used “fake parts” when servicing aircraft, and that a crime syndicate had infiltrated the airline's technical team. SAAT denied this, but finance minister Tito Mboweni later confirmed widespread theft at SAAT, including that “a whole engine” was stolen.
FlySafair, which owns its own maintenance arm, has capitalised on SAAT’s problems - and continued to fly as other planes were grounded.
Receive a daily update on your cellphone with all our latest news: click here.
Get the best of our site emailed to you daily: click here.
Also from Business Insider South Africa:
- We tracked 21 braai essentials since 2019 – and some chains are now significantly cheaper
- A man denied R505 in an insurance promotion, for cars worth R2.7m, fought Old Mutual – and won
- Discovery director sells R387 million in shares over two days
- Coding in schools and online courses – here's govt's new plan to build SA's tech skills
- Woolworths now sells Birkenstocks - and will add more brands as it fixes fashion 'mistakes'
- We tried all the new menu items at Nando's - here's what we will definitely order again