South Africa should act to preserve its insolvent national airline and seek to partner the carrier with Ethiopian Airlines Group, according to a study commissioned for ruling-party lawmakers, Bloomberg News reported. The assessment, seen by Bloomberg, was prepared by African Aviation Services Ltd. and dated Oct. 4. It was presented to a group of African National Congress lawmakers on Monday, according to an ANC official who asked not to be identified because the information isn’t public.
Ethiopian Airlines Group is willing to provide planes, pilots and maintenance services to beleaguered rival South African Airways as part of a joint venture with that country’s government, Bloomberg News reported. Africa’s biggest airline is offering operational assistance, Ethiopian Chief Executive Officer Tewolde GebreMariam said in an interview in Addis Ababa. The carrier isn’t interested in helping with debt repayments or the cost of reducing the workforce, he said.
Ethiopian Airlines is in talks over possible involvement in the rescue of flagship carrier South African Airways (SAA), the head of the airline told Reuters on Friday, Reuters reported. SAA hasn’t made a profit since 2011 and has been under a form of bankruptcy protection since late last year. Creditors have approved a restructuring plan, but the government needs to find at least 10 billion rand ($580 million) of funding for it to work.
Ethiopian Airlines Group is among companies in talks with South Africa’s government about potentially offering support to the country’s insolvent state airline, according to people familiar with the matter, Bloomberg News reported. Africa’s biggest carrier is considering ways to help bankrupt South African Airways fly again after more than five months of dormancy, said the people, who asked not to be identified as the talks are private. Taking a stake in the carrier is one of the options under discussion, they said, though negotiations are ongoing and an agreement may not be reached.
Moody’s has clashed with the UN after putting five countries on review for a downgrade in recent weeks, saying that a G20-backed debt suspension scheme poses risks to private creditors, the Financial Times reported. The rating agency took action against Ethiopia, Pakistan, Cameroon, Senegal and the Ivory Coast, after the countries opted into a G20-backed initiative that allows them to freeze official bilateral debt repayments due this year to member nations and members of the Paris Club, a group representing major credit countries.