South African Airways (SAA) has suspended operations. No funding was found.
South African Airways (SAA) is undergoing a rehabilitation process by the administrators responsible for its restructuring. But unfortunately no funding was found, and this inconvenience led to the suspension of activity.
Officially, South African Airways (SAA) is suspending its activities. The information was revealed in an internal letter, issued on September 29, 2020 and obtained by Reuters.
"The administrators decided to suspend all operations of the airline with immediate effect", It is shown in the communiqué. According to the document, South African Airways (SAA) will remain in this mode until there are funds for the restructuring and rehabilitation of the company.
The restructuring plan was approved by the administrators on July 14, 2020 and, 2 days later, the South African Department of Public Enterprises stated that the National Treasury had allocated $ 59 million to finance it.
On July 21, the government said it did not agree with the plan and did not approve the funding, while on September 18 it canceled its decision and pledged to provide $ 650 million.
The administrator's latest statement and suspension of operations means that the government may have overturned the South African Airways (SAA) financing decision again.
The last time the SAA was expected to cease operations was in May 2020, but the airline did not do so and continued to operate flights. South African Airways (SAA) received protection against bankruptcy in December 2019, after 8 years of losses. Previous attempts at restructuring were rejected by the company's unions.