We’ll find the money (R10.5bn)! We won’t allow SAA to die – Public Enterprises

The "new" SAA needs more than R10 billion to take off. Arabile Gumede interviews Intellidex’s Peter Attard Montalto.

The government won’t allow the liquidation of South African Airways (SAA), said Public Enterprises Director-General Kgathatso Thaludi on Monday.

It has, according to Thaludi, committed to providing “billions” of rands to restructure the state-owned airline and now needs to create a mechanism to channel the funds.

The “new” SAA needs more than R10 billion to take off.

The Department says that money will come from a reprioritisation in Finance Minister Tito Mboweni's adjustment budget next month – in the meantime, shortfalls will be covered by loans.

“We will not allow SAA to be liquidated,” said Thaludi.

“SAA shall be a stronger airline going forward to ensure that it performs the role of supporting the economy."

Arabile Gumede (in for The Money Show’s Bruce Whitfield) interviewed Peter Attard Montalto, Head of Capital Markets Research at Intellidex.

What to cut to fund this? Education? Maybe healthcare? Maybe provincial investment budgets?

Peter Attard Montalto, Head of Capital Markets Research - Intellidex

There are still gaps in the market… but not at these major hubs… The private sector can provide… There are many other options… I’m sceptical that anything beyond a small national airline is really necessary.

Peter Attard Montalto, Head of Capital Markets Research - Intellidex

Are creditors happy with this? Are banks happy to fund a possibly unsustainable airline?

Peter Attard Montalto, Head of Capital Markets Research - Intellidex

Political direction has finally been given from the top…

Peter Attard Montalto, Head of Capital Markets Research - Intellidex

Listen to the interview in the audio below.

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