LOAN FACILITY NEEDED
EXCLUSIVE: Pravin Gordhan in race to secure special credit facility for SOEs
Banks have not yet restored lending to several state-owned enterprises (SOEs), underlining the urgency of talks between the government and financial institutions to establish a loan facility through which credit can be channelled. The two worst-off SOEs are Denel and SA Express, which raise money month by month to pay salaries and suppliers, public enterprises minister Pravin Gordhan said in a briefing to parliament’s public enterprises committee on Wednesday. SAA is projected to run out of working capital by October. "Denel has a liquidity squeeze and the board and management must scramble around for funds at the beginning of each month so that at the end of it they can pay salaries," he said. Denel owes R1.1bn to creditors and "is caught in a vicious cycle in which it can’t pay suppliers and so can’t manufacture to get revenue". "It received assistance from government of R580m earlier this year," Gordhan said. SA Express, which is expected to resume two flights a week from next we...
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