South Africa

Eskom Holdings SOC Ltd., the state utility that supplies most of South Africa’s power, said it’s seeking to appoint advisers on how to restructure itself into three separate units, a reorganization that was proposed to let it to better deal with an untenable debt burden, Bloomberg News reported. The separation of the Johannesburg-based company into transmission, generation and distribution units was first raised by South African President Cyril Ramaphosa more than two years ago.
Read more
South African Finance Minister Tito Mboweni affirmed his commitment to reining in debt amid concerns that the coronavirus pandemic and a week of deadly riots will further erode the state’s already shaky finances. “We are not going to go to a sovereign debt crisis for now, at least not under my watch,” despite opposition to spending constraints, Mboweni said in an interview on Wednesday. “There is no such thing as a popular minister of finance -- it doesn’t exist, it’s a contradiction in terms.
Read more

South Africa’s Treasury expects a relief package for businesses and individuals affected by this month’s deadly riots to cost 38.9 billion rand ($2.6 billion), Bloomberg News reported. The government will spend an additional 31.2 billion rand and grant 5 billion rand in tax breaks, while 2.65 billion rand will be reallocated from within the budget, Edgar Sishi, the acting head of the budget office, said in an online briefing on Wednesday. The program won’t require additional borrowing, Treasury Director-General Dondo Mogajane said at the briefing.

Read more
South African Airways (SAA) subsidiary Mango Airlines temporarily suspended all flights and services on Tuesday until further notice due to outstanding payments to Air Traffic Navigation Services, Mango acting CEO William Ndlovu said, Reuters reported. “Senior management and our shareholder are locked-in in emergency discussions to find an amicable solution to this impasse,” Ndlovu said in a statement. The budget carrier is in a dire financial position despite the South African parliament having approved a special allocation of 2.7 billion rand ($182.3 million) for SAA subsidiaries.
Read more
South African Airways (SAA) subsidiary Mango Airlines will enter into a local form of bankruptcy protection known as business rescue, according to SAA’s interim chief executive Thomas Kgokolo told Reuters reported. SAA, which itself exited business rescue in April, is one of a handful of South African state companies that depended on government bailouts, placing the national budget under huge strain. “What we can say is that the board and shareholders have agreed that Mango will go into business rescue,” Kgokolo said in an interview with TV station eNCA.
Read more

After loosing 53 cars during xenophobic attacks in South Africa in 2019, Johannesburg car dealership owner Okey Uchendu never thought he would see his business destroyed again by civil unrest in less than two years. Already dealing with the impact of COVID-19 on the economy, Uchendu received a call at midnight on Sunday that his dealership was engulfed in flames as looting and violence, the worst in South Africa for years, escalated, wrecking hundreds of businesses, Reuters reported.

Read more
Steinhoff International Holdings NV may soon release a revised proposal to resolve more than $8 billion of legal claims against the retailer after a previous deal recently fell through, Bloomberg News reported. The company “is considering its options” after a South African court ruled on July 2 that the deal related to debt refinancing was void. Steinhoff still believes that “a global settlement is in the interest of all parties,” and will “strive to achieve one,” a spokesman said on Wednesday. This is expected to include a revised offer to be made shortly.
Read more
The Cajee brothers, who ran a cryptocurrency investment platform from South Africa that the local regulator suspects of being a Ponzi scheme, are confounding both their family and desperate investors alike, Bloomberg News reported. It’s still hard to establish the whereabouts of Ameer and Raees Cajee, the pair that operated Johannesburg-based Africrypt since 2019. They appear to have vanished, along with an estimated $3.6 billion in Bitcoin -- an amount that a lawyer for the brothers said was inflated.
Read more
South Africa agreed to sell a majority stake in the country’s grounded national carrier to a local jet-leasing company and private-equity firm, ridding the government of an entity that has long been a drain on state finances, Bloomberg News reported. A consortium comprised of Johannesburg-based Global Airways, which owns recently launched domestic airline Lift, and private-equity firm Harith General Partners will take a 51% shareholding in South African Airways, Public Enterprises Minister Pravin Gordhan said on Friday. The government will retain a minority stake.
Read more
South Africa’s government is set to announce that it has found a strategic equity partner for state-owned carrier South African Airways, Bloomberg News reported. Details of the announcement are expected on Friday morning. Public Enterprises Minister Pravin Gordhan was scheduled to brief the media on the matter Thursday, before postponing to the following day. The expected announcement comes about six weeks after the airline emerged from lengthy bankruptcy proceedings, having reduced its workforce by almost 80% and cut liabilities.
Read more