South Africa: The Nuclear Option - What Does Business Rescue Mean for SAA?

opinion

While business rescue is a useful strategy, and possibly the only one capable of forcing the government to make difficult political decisions regarding job cuts and the loss of patronage, it needs to be handled with the care of a nuclear bomb.

After threatening for a number of years, Solidarity has decided that it too has had enough of SAA's long deathbed struggle and so the trade union has launched an application to force the airline into business rescue.

Solidarity argues that if drastic action is not taken, the airline will collapse - leading to the loss of 240 of its members' jobs. These 240 members may be tiny compared to the cacophony of threats, counter threats and intimidation emanating from the cabin crew and metal workers unions' (Sacca and Numsa) strikers, but Solidarity's business rescue application is potentially a far more serious threat to the airline's existence and will have a huge impact on the government's finances.

Solidarity is a trade union with the skills and resources to mount a proper business rescue application - and it has a management team with a turnaround plan waiting in the wings. If Solidarity's application is successful, it would be the first...

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