South Africa: Government Admits Denel Cannot Continue to Exist Without Bailouts

press release

In response to a Democratic Alliance (DA) parliamentary question, Defence and Military Veterans Minister, Nosiviwe Mapisa-Nqakula, said Denel cannot continue to exist in its current form: "[it] is clear, without a significant bailout by government, Denel will not be able to exist in its current form and will not be in a position to meet its contractual obligations to Armscor."

Interim Denel Chief Executive,Talib Sadik, is on record as saying that Denel would not seek any government equity injections to stay afloat: "[at] this stage it is not in our plan." Sadik is reported as saying in an interview, when asked if Denel would approach government for further bailouts; "[our] view is we need to fix our own house, because what we have is a bit of moral hazard".

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