The Development Bank of Southern Africa has agreed to provide R3.5 billion to help the South African Airways (SAA) with its business rescue.
The SAA will get R2 billion of this immediately and people can now safely buy air tickets from SAA again, Les Matuson and Siviwe Dongwana, joint business rescue practitioners, said on Wednesday evening.
This comes after a week of tension in which the government failed to come up with its promised R2bn that it would give to SAA as part of the December agreement to put the struggling airline in business. Private commercial banks have already provided R2 billion in financing to SAA as part of the agreement.
The government’s R2 billion should have been received by January 19, according to business rescue practitioners, and in the following week, the SAA had to cancel 19 flights, including two international flights to Munich, Germany.
According to the business rescue practitioners, Development Bank of Southern Africa financing is intended for short-term cash flow requirements to keep the airline running until the business rescue plan is published and accepted.
Inquiries about when the plan will be published have not yet been answered. It is also unclear why the amount of R2 billion has now suddenly grown to R3.5 billion and whether it is a loan that the government or SAA will later repay.