South African Airways risking liquidation

South African Airways (SAA) needs a government guarantee to help it secure bank funding otherwise the carrier is at risk of entering liquidation, board member Martin Kingston said on Wednesday, as a crippling strike enters its sixth day.

The cash-strapped airline has cancelled hundreds of flights since the strike began on Friday, with the stoppage initially costing 50 million rand ($3.36 million) per day, though that figure has come down as some flights have resumed.

Speaking in an interview on news channel SABC, Kingston said that SAA’s dire financial situation meant it was in no position to increase its wage offer to striking unions, and the action was only making the state-owned airline’s position more perilous.

The Department of Public Enterprises said on Wednesday there was no more money in public coffers for SAA, with multiple bailouts for the airline and other ailing state-run firms becoming a “moral hazard”.

Via Reuters