SAA given cash lifeline

Hopes of saving South African Airways from possible collapse rose slightly last week after the carrier was given a lifeline with a rescue plan which saw a cash injection of R4bn (about £207m) from the South African government and existing lenders.

The airline has been placed into a form of bankruptcy protection, business rescue, with a specialist taking control to rehabilitate the company to improve its chance of survival or to secure a better return for creditors than they would get from liquidation.

In a statement, the airline said: "SAA understands that this decision presents many challenges and uncertainties for its staff. The company will engage in targeted communication and support for all employee groups at this difficult time.

"SAA will endeavour to operate a new provisional timetable and will publish details shortly. The company greatly appreciates the continued support of both its customers and partners in the travel industry around the world."

SAA has not made a profit since 2011 and has depended on government bailouts to stay solvent. Its situation was worsened last month when it was hit by an employee strike forcing it to cancel hundreds of flights and pushing it to the brink of collapse.

(See also 'Hong Kong Air back from the brink' in this issue).

www.flysaa.com

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