South African Airways (SAA) business rescue practitioners, on Tuesday 28 July, released a statement saying that conditions outlined in the business rescue plan have been fulfilled by government, therefore, the plan is "unconditional" and will take up operation.
Following a creditors voting meeting on Friday 24 July, it was stipulated that a paragraph in the business rescue plan had been amended and had to be fulfilled and confirmed by government by Monday 27 July. It seems as though the government has managed to fulfil its obligations.
SAA BUSINESS RESCUE PLAN 'UNCONDITIONAL'
SAA business rescue practitioners Les Matuson and Siviwe Dongwana said the conditions that had to be approved, were fulfilled by the stipulated deadline.
"Please note that all conditions set out in paragraph 42.1 were fulfilled on or before 27 July 2020 and the business rescue practitioners are currently attending to and finalising the remaining and outstanding administrative issues before filing a notice of substantial implementation," the statement read.
If the conditions were not fulfilled by government, the plan would have been deemed unimplementable and a meeting would be convened on 30 July for SAA creditors to consider amending the business rescue plan.
If that didn't pan out, the creditors could have opted for the liquidation of the airline.
"There will be no meeting on 30 July 2020 and the plan has become unconditional and has come into operation," it added.
THE PLAN WAS SUBJECT TO THE FULFILLMENT OF THESE CONDITIONS
Conditions for the SAA business rescue plan to come into operation and be fully implemented were:
The approval and adoption of the Business Rescue Plan in terms of section 152 of the Companies Act;
- Approval of the Minister of Public Enterprises and the Minister of Finance (to the extent necessary), as executive authority for SAA, for the implementation of those aspects of the Business Rescue Plan which involve transactions requiring such approval in terms of section 54(2) of the PFMA, read with the Significance and Materiality Framework for SAA; [*]Approval of the Minister of Public Enterprises, as a representative shareholder of SAA, for the implementation of those aspects of the Business Rescue Plan which involve transactions requiring such approval in terms of the MoI; [*]An agreement is reached with the employees, their respective Trade Unions and SAA on the reduction of headcount and revised terms and conditions as set out in paragraph 33 by 17 July 2020, failing which the section 189 process is continued with or a new 189 process is initiated by 22 July 2020; [*]Confirmation of Government's support and commitment to providing the requisite funding for the various commitments stipulated in paragraph 28 the Business Rescue Plan. This is to be evidenced by way of a letter of support from the Department of Public Enterprises with the concurrence of the Department of National Treasury. Such a letter is to be received on or before 15 July 2020; and [*]The Government has provided confirmation satisfactory to the DBSA, PCF Bank Lenders and the Pre-commencement Lenders that the Guarantees issued to them in respect of the Pre-commencement Claims and the PCF provided by them to the Company (collectively, the Lender Claims) shall continue in full force and effect until the Lender Claims are discharged in full as contemplated in this Business Rescue Plan.