Africa

Administrators at South African Airways have asked for more time to publish a business rescue plan for the struggling state-owned airline so they can discuss new government restructuring proposals, a letter to creditors showed, Reuters reported. The administrators, who were meant to publish their plan on Friday, have asked for a new deadline of June 8 so they can consult with creditors, employees and the government. If the delay in publication is approved, they will start those talks on June 1, they said in the letter, dated May 28.

Kenya urgently needs to establish a credit-guarantee program to reduce the risk of lending to small- and mid-sized companies battered by the coronavirus pandemic, according to central bank Governor Patrick Njoroge, Bloomberg News reported. Three in four small businesses in the East African economy only have cash to cover two months of requirements, Njoroge said, citing an April survey.

Zambian president Edgar Lungu’s government has hired Lazard to advise on restructuring the cash-strapped southern African nation’s $11bn foreign debts that have threatened to become Africa’s first sovereign default during the coronavirus pandemic, the Financial Times reported. The investment bank was hired on a $5m contract to advise on “liability management” of the country’s debt after a tender process, the Zambian ministry of finance said on Wednesday.

South African Airways (SAA) can still be saved if it gets the necessary funding, the state-owned airline’s administrators said on Wednesday, adding they were talking to the government about a potential restructuring, Reuters reported. The comments in a letter to affected parties seen by Reuters mark a shift in tone from a recent appearance before a parliamentary committee, when the administrators said a wind-down of the business was a probable outcome.

South African Airways (SAA) aims to resume domestic flights between Johannesburg and Cape Town from mid-June, the cash-strapped airline said on Tuesday, as coronavirus lockdown restrictions ease, Reuters reported. SAA, which is under a form of bankruptcy protection, suspended all commercial passenger flights in late March, when the government imposed one of the strictest lockdowns on the African continent.

Kenya’s biggest bank by assets, KCB Group, has restructured more than 110 billion shillings ($1 billion) of its loans to customers and up to a quarter of its book could be affected by mid-June, its chief executive told Reuters, Reuters reported. The central bank allowed lenders in the East African nation to offer relief to distressed customers in mid-March after the first COVID-19 case was reported. Total restructured loans for the industry stood at 273 billion shillings, 9.6% of the total, at the end of April, the central bank said in a presentation sent to the media on Thursday.

South Africa’s third-biggest telecom operator, Cell C, plans to hive off assets into a new special purpose vehicle (SPV), the country’s competition watchdog said on Thursday, as part of a plan to restructure the company’s debt, Reuters reported. Gatsby SPV has been set up for the purpose of the proposed transaction, the Competition Commission said in a statement. It did not give details about the deal or indicate which assets of Cell C may be sold to Gatsby. The Commission said Gatsby SPV will be controlled by a trust that is yet to be formed.

Some of the world’s poorest oil-producing countries are slipping behind on payments for billions of dollars in oil-for-cash loans from commodity trading houses, putting them at risk of default, Bloomberg News reported. The so-called prepayment deals, in which a trading house advances a nation money to be repaid with future oil shipments, have been popular among some African and Middle East oil nations as the only way to raise funds. But they have also proved controversial: in some cases they create an opaque source of debt that governments find hard to pay back when oil prices plunge.

South Africa mobile operator Cell C said on Wednesday it had finalised a recapitalisation plan, which has been sent to the Competition Commission for approval, Reuters reported. The country’s third-largest telecoms company, which is majority owned by Blue Label Telecoms, defaulted on a series of debt payments earlier this year having underperformed in a highly competitive market dominated by MTN and Vodacom.

The Tanzanian unit of Kenya’s ARM Cement Plc has been sold to China’s Huaxin Cement company, its administrator PricewaterhouseCoopers and Huaxin said on Wednesday, paving way for completion of one of its production plant, Reuters reported. Huaxin would inject $116 million into the unit, Maweni Limestone Ltd, to settle liabilities, and another $30 million to complete plant construction and upgrade, according to their joint statement.