The Black Management Forum (BMF) has expressed unhappiness over the appointment of Philip Saunders as South African Airways (SAA) Interim CEO. This week, creditors, unions and other stakeholders voted in favour of the amended SAA Business Rescue Plan.
Saunders, who was SAA’s acting COO, is now expected to work closely with the interim board to appoint a management team to restructure SAA. BMF President, Andile Nomlala, has raised questions over Saunder’s competency to lead the national carrier.
“The issue here is that you are trying to resuscitate an airline that has a very complex business model and you are trying to take it off the ground but then you still find less than minimum requirements type of people to take it off the ground. None of the big finance institutions in this country that used to usually put money into the SOEs have confidence in Saunders. So that means that government will have to use taxpayers’ money or give guarantees to the banks for them to be able to fund these types of businesses,” says Nomlala.
Aviation Analyst Desmond Latham has expressed cautious optimism in the competence of Philip Saunders as SAA’s new Interim CEO.
Latham says Saunders is a different type of leader, compared to what the ailing national carrier had previously.
“This is a new kind of manager that has come into SAA. He has got global experience. Whether he can do it, people are saying he hasn’t run a big airline, well SAA is not a big airline, it is a small airline when you look at the dollar terms here. We will have to wait and see what happens but I think he is up against the wall in terms of the way in which the government has mismanaged the airline for 10 years, it has not made a profit. Meanwhile, SAfair is making a profit, Mango has made a profit, even SAA’s technical division has made a profit but the airline itself had corrupt leaders,” says Latham.
SAA rescue plans gets thumbs up as new Interim CEO appointed
The SAA Business Rescue plan was adopted with 86% of the creditor’s voting in favour of the amended plan.
Government also welcomed the vote in favour and applauded creditors and stakeholders for realising that a new, restructured, competitive airline, is the best option to immediately take the airline back to the skies. In terms of the Companies Act, the proposed rescue plan may be implemented subject to funding being obtained.
The Department of Public Enterprise has also undertaken to provide proof of funding for the plan to go ahead as required by the Companies Act.
The Department of Public Enterprise says they will appoint a new interim board in the coming weeks with its current acting COO Philip Saunders acting as the new interim Chief Executive.
“We have received proxy’s and 86% are in favour of the business rescue plan of SAA. In the vote, in terms of the Act, the business plan will be approved on a preliminary basis if it is supported by the holders of more than 75 percent of the creditor voting interest and in this case and the second part the votes in support of the proposed plans included at least 50% of the independent creditors voting interest. The non-independent interest if less than a percent,” says Siviwe Dongwana, one of the joint Business Rescue Practitioners.
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