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evanb
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Re: SAA considers selling off assets as debt balloons

Sat Nov 17, 2018 3:11 pm

T54A wrote:
I suspect there are very few employees left with defined benefits, most will be on defined contribution. There some of old Captains I know of that are on DB. Very few though.


61 active employees (70 last year), 298 pensioners (304 previous year). Retirement benefit obligation on the balance sheet of ZAR 121 million (USD 8 million). Very small.
 
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janders
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Re: SAA considers selling off assets as debt balloons

Tue Nov 27, 2018 5:13 pm

Patience wearing thin

South African Airways’ Suppliers Are Cracking Down on Getting Payments
https://skift.com/2018/11/27/south-afri ... -payments/
"We make war that we may live in peace." -- Aristotle
 
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LAXintl
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Re: SAA considers selling off assets as debt balloons

Tue Nov 27, 2018 5:30 pm

I saw an analyst note that said SAA is asking for US$540 million in December to fund day-to-day operations into 2019. Additionally, it needs $288 million in March 2019 for balloon debt payments due.
From the desert to the sea, to all of Southern California
 
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lightsaber
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Re: SAA considers selling off assets as debt balloons

Tue Nov 27, 2018 6:02 pm

janders wrote:
Patience wearing thin

South African Airways’ Suppliers Are Cracking Down on Getting Payments
https://skift.com/2018/11/27/south-afri ... -payments/

If subsidies are available, a company will be managed to need them. It is a good thing the South African government has plenty of funds... Oh wait...

https://mobile.reuters.com/article/amp/idUSKCN1NW0Y9

IMHO, their government hasn't read Bernstein and the economy is suffering due to rules in flux. Time to spin off government owned enterprises to save the economy. They also have violated the Laffer curve on mine investment (The owners cannot close a business case). This impacts premium demand.
10 months without TV. The best decision of my life.
 
texl1649
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Re: SAA considers selling off assets as debt balloons

Tue Nov 27, 2018 7:14 pm

Tough to spin off government subsidized entities (aka SOE's) when private property rights are being disabused, entering a recession, facing a major non-natural disaster (water), and plummeting corporate/personal income taxes.

At the end of the day, airlines are a very capital intensive business model, and I struggle to see how SAA can prosper/succeed over the next decade or two going from one government bond-driven bridge loan to the next. This seems doomed to...end poorly.
 
mr02
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Re: SAA considers selling off assets as debt balloons

Tue Nov 27, 2018 10:11 pm

I saw the article today and was quite surprised that they blew through R5 billion in a month. Obviously, R3 Billion went to paying arrears but 2 billion is still a lot of money to work with! I'm positive that SAA can be saved but seeing this,I'm becoming less optimistic. The only way to save SAA is that they get a CEO with aviation experience, whether it's Tewolde(ethiopian's CEO)or someone from Europe(Lufthansa CEO),to take those drastic decision which might save SAA.
 
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aemoreira1981
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Re: SAA considers selling off assets as debt balloons

Thu Dec 13, 2018 7:21 pm

In terms of assets, does SA have any other than their old A340s and maybe ground equipment?
 
mr02
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Re: SAA considers selling off assets as debt balloons

Sat Dec 15, 2018 8:40 pm

I am not sure but all I know is that they had lots off assets prior to Andrew Coleman's hiring. He sold all of SAA's aircraft and leased them back to "a company known to him or has close ties with him".
 
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lightsaber
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Re: SAA considers selling off assets as debt balloons

Sat Dec 15, 2018 9:03 pm

texl1649 wrote:
Tough to spin off government subsidized entities (aka SOE's) when private property rights are being disabused, entering a recession, facing a major non-natural disaster (water), and plummeting corporate/personal income taxes.

At the end of the day, airlines are a very capital intensive business model, and I struggle to see how SAA can prosper/succeed over the next decade or two going from one government bond-driven bridge loan to the next. This seems doomed to...end poorly.

There is a word for that:. Corruption.

The business climate isn't conducive to investment. If they do start seizing assets, no one will invest. Part of the issue is land. Bank loans are made with land as collateral. If the collateral ownership is in question, it isn't collateral.

Part of the problem is South African business, including SAA, isn't allowed to be run as a business (e.g., correct staffing, equipment, and pay).

When people are afraid, rational or not, the economy suffers and with it air travel.

I personally believe it is already too late to save SAA. But the obvious won't be acknowledged until the government bond rating drops another 2 notches.

It is easy to spend other people's money until they get it to safety.

I wish people would read Adam Smith's Wealth of Nations. It is so true.

Lightsaber
10 months without TV. The best decision of my life.
 
mr02
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Re: SAA considers selling off assets as debt balloons

Sat Dec 15, 2018 9:21 pm

I also think that trade unions are a risk. Let's take Comair as an example:Numsa are striking over wages,but what they probably don't know is that Comair is a LCC,meaning that employee salaries will be low. The more they ask,the more people are fired because labor costs will be too high,so Numsa loses and that's why Trade Unions are resorting to protest action when companies announce retrenchments. The less people working means less money collected every month,so the only idea is resorting to violence
 
Planeflyer
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Re: SAA considers selling off assets as debt balloons

Sun Dec 16, 2018 1:20 am

All of this and I don’t exaggerate when I say all is explained in a wonderfully written book titled The mystery of Capital. The author is former communist from Peru named Desoto who deserves but will probably never win a Nobel prize.


The book can be read in a few hours.
 
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piedmontf284000
Posts: 511
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Re: SAA considers selling off assets as debt balloons

Sun Dec 23, 2018 5:35 pm

Looks like SAA might have been thrown a lifeline...but it comes with a catch

https://www.fin24.com/Companies/Industr ... t-20181223
 
mr02
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Re: SAA considers selling off assets as debt balloons

Sun Dec 23, 2018 6:41 pm

I don't think the government will give up a controlling stake in SAA. But beggars can't be choosers
 
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lightsaber
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Re: SAA considers selling off assets as debt balloons

Sun Dec 23, 2018 7:55 pm

piedmontf284000 wrote:
Looks like SAA might have been thrown a lifeline...but it comes with a catch

https://www.fin24.com/Companies/Industr ... t-20181223

Large hedge funds set the terms for governments. Is South Africa ready to accept that is where they are? Perhaps not.

Lightsaber
10 months without TV. The best decision of my life.
 
KingOrGod
Posts: 192
Joined: Mon Jan 16, 2017 3:19 pm

Re: SAA considers selling off assets as debt balloons

Sun Dec 23, 2018 8:34 pm

lightsaber wrote:
piedmontf284000 wrote:
Looks like SAA might have been thrown a lifeline...but it comes with a catch

https://www.fin24.com/Companies/Industr ... t-20181223

Large hedge funds set the terms for governments. Is South Africa ready to accept that is where they are? Perhaps not.

Lightsaber


Most half intelligent south african's are likely well past willing to accept this.

It's the entitled gravy train passengers (ie the goverment at the moment) who think that a SEO's (state owned enterprise) exist solely as a cash cow to be plundered until infinity without any form of oversight.

This sh1t has to stop in south africa if they want to prosper. It's the same at all SEO's, without exception.

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