Zuma

SAA, Dudu “Fast Asleep” Myeni & Visigoths

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South African Airways is up a creek.  With a financial paddle that is you and I aka the taxpayer.  Circling above in a banking holding pattern are creditors.  It doesn’t really matter what Dudu “Fast Asleep” Myeni thinks, its what’s going to happen to her that is a True Story.  Because the reality is our national carrier is no longer considered a going concern.  By it’s own Board.

This has fiduciary implications for Myeni and her chommie Jacob “hehehehehehe” Zuma.   While she appears to have high friends in places,  this is only a fleeting moment of safety.  Because coming soon at a SAA movie house near you is liquidation.  No amount of spin doctoring is going to save the national airline, only a sudden and significant change in operations will do that, along with another beefy bailout.

 

That’s not going to happen while Myeni cocks a snook at Finance Minister Nhlanhla Nene.   So she has to go.

The SAA Board Submission which you’re not supposed to see but is easily and readily available online – here – describes a very serious financial condition.

The essence of the finding is that SAA is no longer a going concern.  Worse still,  the submission describes a business being conducted recklessly.

That’s bad.  Very bad.  It’s a disaster for the present executive.

Our national Airline is suffering from reckless trading.  Technically, creditors who’re owed billions could use Section 131 (1) of the Companies Act to apply for a court order placing SAA under supervision and to begin business rescue.

SAA does not meet the solvency and liquidity test required to continue operating as a going concern.  Solvency relates to the assets of the company exceeding liability,  and liquidity means the company can pay its debts over 12 months.   It may pass the solvency test, but its failed the liquidity exam.

The Board Submission notes:

“Based on the reliance on a going concern guarantee and the inability for the auditors to sign off on the annual financial statements, SAA has been and remains technically insolvent.  Accordingly, SAA is financially distressed and trading under insolvent circumstances.  Any further trading under the current circumstances constitutes reckless trading in terms of Section 22 of the Act.”

What this really means is two things.

  1. That SAA files for business rescue and is then protected legally or
  2. The Directors apply for liquidation on an urgent basis.

Time is of the essence.

But Myeni, what of her?  She’s hanging around meetings and refusing to co-operate.  With Finance Minister Nene firstly. That’s all going swimmingly for this walking disaster of a Chairwoman.  Zuma is protecting her back.  For now.  She’s refusing to negotiate and her edicts are ultimately self-destructive.  However, when fiduciary reality catches up with her,  she’s going to be toast.  It’s all a great game.  Then she walks away with the inevitable golden handshake.  Goodbye, you’ve been a disaster, here’s R12m.

In the meantime we live with a terminal SAA that’s slipping quickly into a financial coma while Myeni and Zuma play the giddy goat.  The Board Conclusion is noted.  It’s suggested that the following four options be considered extremely urgently:

  1. Request the shareholder inject capital.  That’s you and me folks, via the government.
  2. Finalise its decision regarding the Swap Option.  This is a very technical process, but basically SAA changed an Airbus A320-200 purchase into a Swap for other aircraft.  They’ve got to make up their minds NOW on this deal.
  3. Reach out to Airbus and try and find a way forward.  If not, court action and possible liquidation threatens.
  4. Establish a transaction team to renegotiate the Swap.  Myeni has tried to get that done through a third party – her .. umm .. friends? 

Thousands of jobs are threatened.  Staff are beginning to have an inkling about what’s going to happen.

It’s not going to be pretty,  and perhaps its time to prepare the crime scene forensic cleaning team to put on their rubber gloves, mask and full-body gown.  Wiping the blood off the walls at  SAA is going to take nerves of steel and the constitution of a Visigoth.

 

 

 

 

 

 

Inauguration Blues – its good to be in touch.

desmondlatham1 Comment

So on Saturday 24th May a 25nm no-fly zone was extended from Pretoria and the union buildings outwards.  That created a few challenges for General Aviation scuttlebutts like me – even with reference number and flight plan clutched in my sweaty paw.   Jacob Zuma was being inaugurated – again – and the Air Force shut down part of Gauteng’s airways in fear of the president’s safety.  Or is it because they felt like practicing for a proper moment of danger?  I dunno.  Whatever.  The bottom-line was no flying out of Lanseria towards the East and North.

That’s ok,  because I was heading west to Potchefstroom.  A suitably quiet route usually at 8am on a Saturday.  I wanted to practice approaches and let-downs.  After refuelling ZS-ZIP and adding two quarts of oil I fired up and taxied to the runup zone on Lanseria’s 07.  Checked map, Cirrus Avidyn GPS working,  Garmins both up and running, my handheld Garmin on the passenger seat in case of failure.   Short hop 63 nautical miles to Potch,  and I added 5 minutes for approach and landing.

Clearance from Lanseria was special VFR.  Remain above 5500 ft at all times was the ATC parting message, and route via the Northate Dome.  With a slight tailwind,  the Cirrus SR-20 managed 140 knots which cut the time to Potchefstroom down from the 30 mins expected to closer to 20.   But I was not alone.  A Baron and a Cessna 210 were also flying in to Potch,  while at the airfield two sports cruisers were conducting training.  Even so,  it was quiter than usual in this airspace.

The route courtesy of vrfplanner.org.
The route courtesy of vrfplanner.org.

All did not go exactly according to plan.  First I overshot Potch the visibility was so bad.  It was down to 5km or less which is borderline for visual rule flying.  After attempting a letdown,  I missed runway 03 to the East and decided at that point to do a missed approach and head back to Lanseria.

Flying back there was only one moment of real interest.  A Robinson helicopter pilot to the south of the Dome near Joburg was warned by the Air Force to get out of the air as he was in a no-fly zone.  The pilot was not aware of the online Notam which had gone out warning about the inauguration.  It made me think about aviation.  Many pilots are basically loners and independent in spirit, but sometimes its good to be communicating with a group – just to avoid the embarrassment of missing a Notam.

I contacted Lanseria Tower – and was told to head straight for the threshold and avoid the Dome.  The problem was the visibility.  With the sun still low in the East,  I was basically flying almost blind directly into the burning disc.  That means at 2 nautical miles I still couldn’t see Lanseria’s threshold.  The VOR reading showed I was to the left,  but my  head said the runway was directly in front.  Suddenly  I realised at 1 nautical mile that runway 07 was actually at my 2 0’clock and I requested a go-around which was confirmed by the tower.

On downwind I had to orbit as a Mango flight was taking off on runway 250 and caused me to fly an extended base leg.  That meant Lanseria’s runway disappeared in the murk as I turned onto finals, but this time was flying more accurately with instruments.  The landing was clean and off on Alpha back to the hangars.

Practice practice practice.   Read Notams.  Communicate with other pilots prior to takeoff, particularly  in today’s digital world where hard copy Notams are no longer sent by mail to pilots around South Africa.  In the age of information,  poor communication is growing.  Pilots are less informed than their predecessors about changes to the rules.  Now that’s a worry.