Wednesday 4 December 2019 2:55 pm

South African Airways: State-owned carrier in limbo as bailout doubts persist

Time is running out for South African Airways (SAA), as the embattled carrier hopes for a bailout from South Africa’s government.

The state-owned airline paid only half of staff salaries last month, and may have to file for liquidation in the near future if it cannot secure R2bn (£100m).

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SAA operates flights to and from London Heathrow.

Last week, Pravin Gordhan, minister for state-owned companies in South Africa, said the firm suffered a “sudden deterioration” in its finances after a recent strike left flights grounded.

The government was looking to “urgently formulate immediate actions that will be required to provide support to enable SAA to carry on its business”.

However, it has emerged that South Africa’s finance minister, Tito Mboweni, would prefer the airline to be shut down rather than stump up the cash, rendering a government support package far from a certainty.

“SAA cannot finalize its annual financial statements within the prescribed time until the going concern status is confirmed,” the carrier said in a document submitted to politicians on Monday and circulated by the main opposition Democratic Alliance.

As the government wavers, the airline is also said to be in talks with lenders including Standard Bank and Investec about funding.

Earlier this week Bloomberg reported negotiations are also taking place with Absa, Nedbank and FirstRand’s Rand Merchant Bank.

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SAA has not published its financial results since 2017, when it lost £145m. 

The airline was not immediately available for comment.