history<\/strong><\/p>\n\n\n\nThe report noted that SAA faced “significant financial and operational challenges” in the decade leading up to 2019.<\/p>\n\n\n\n
SAA has a history that is marred by corruption during the years of State Capture, with frequent government interference in its operations<\/p>\n\n\n\n
Back in 2019, SAA, which had around R28 billion in liabilities, was seen as a black hole for taxpayer-funded bailouts.<\/p>\n\n\n\n
These challenges led to the airline entering business rescue in 2019 and further scaling down operations in 2020 due to the COVID-19 pandemic.<\/p>\n\n\n\n
SAA then underwent business rescue and emerged in April 2021 as a “smaller and more streamlined entity,” as reported by Oxford Economics.<\/p>\n\n\n\n
This restructuring involved reducing the scale of its operations and re-establishing some regional and international routes.<\/p>\n\n\n\n
An agreement to sell 51% to Takatso Consortium for R51, with a R3 billion capital injection, was signed in February 2022. <\/p>\n\n\n\n
However, ongoing negotiations saw disagreements over SAA\u2019s reevaluated value, initially set during the peak of its crisis.<\/p>\n\n\n\n
Late former Public Enterprises Minister Pravin Gordhan called off the deal and noted that public interest and fair market price were not adequately addressed in the renegotiations.<\/p>\n\n\n\n
According to the Auditor General of South Africa, between 1 April 2018 and 31 March 2023, the South African government injected over R38.1 billion into SAA.<\/p>\n\n\n\n
R27.6 billion of this was deposited into the airline after the business rescue process.<\/p>\n\n\n\n
Since relaunching in September 2021, SAA has been gradually ramping up operations and working towards rebuilding its network.<\/p>\n\n\n\n
It emerged from business rescue with just six aircraft and five routes, but now currently flies 16 aircrafts and will take delivery of an additional seven during calendar year 2025.<\/p>\n\n\n\n
The current footprint of 16 destinations is modelled to support the extension of the route network into Europe, North America and East Asia as SAA maintains its strategic brand as a premium international network carrier. <\/p>\n\n\n\n
Any more taxpayer bailouts?<\/strong><\/p>\n\n\n\nSAA was recently transferred to the Department of Transport (DoT) as its line department following the dissolution of the Department of Public Enterprises, and Transport Minister Barbara Creecy told Scopa that much smoother flying is to be expected.<\/p>\n\n\n\n
\u201cAs it stands, SAA is debt-free and not looking for additional funding from the National Treasury,\u201d said Creecy.<\/p>\n\n\n\n
\u201cSince exiting business rescue, SAA has repositioned itself as a leading national carrier, taking advantage of its ability to provide long-haul and intercontinental flight services and leveraging its partnerships with other airlines,” added the minister.<\/p>\n\n\n\n
Creecy assured MPs that SAA would not be privatised but welcomed equity stakes from development financial institutions, similar to the Public Investment Corporation\u2019s investment in Airports Company South Africa.<\/p>\n\n\n\n
However, the airline requires a cash injection investment through an equity share partner to reach a healthy financial state and return to its \u201cglory days\u201d.<\/p>\n\n\n\n
With that said, SAA has reported some steady growth for the 2022\/23 financial year; a big change after a period that nearly left the national carrier grounded for good.<\/p>\n\n\n\n
The airline, together with its subsidiaries, posted a net profit of R252 million \u2013 the first time the airline has been in the black since 2012.<\/p>\n\n\n\n
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