Timeline of the turbulence
Last year was tumultuous for SAA and was characterised by a power struggle between former chairperson Dudu Myeni, a compromise chairperson to please former president Jacob Zuma, and her deputy Tryphosa Ramano, part of a new team appointed by then-finance minister Pravin Gordhan.
The board discussed getting a legal opinion on Myeni’s absence from board meetings at a time when lenders were refusing to extend any further grace to
SAA, which could not make loan repayments.
The precarious debt situation saw former finance minister
Malusi Gigaba extend cash bailouts, using reserves from the National Revenue Fund, totalling R5.2-billion to settle debt with Standard Chartered and Citibank, and announcing a further R10billion bailout during the mid-term budget adjustment.
Gigaba also announced a rotation of the board, which saw the removal of several board members, including Myeni and Ramano, and announced a new chairperson, JB Magwaza, and other board members, including Martin Kingston, Geoffrey Rothschild and Nolitha Fakude.
The mandate of the new board, which had been joined by chief executive Vuyani Jarana in November, was to implement a long-term turnaround, underpinned by curtailing expenditure and route and fleet optimisation.
O June 8: The Mail & Guardian reports that SAA, which had reported a loss of R5.6-billion at the end of 2017 and received R15billion in government bailouts, is splurging millions on hiring new executives and costly consultants.
O June 27: The airline fires its chief financial officer, Phumeza Nhantsi, and the chief executive of SAA Technical, Musa Zwane, after an independent disciplinary hearing found them guilty of gross financial misconduct, negligence and dishonesty.
The pair had been suspended for recommending to SAA’s board in 2015 that the airline should sign a contract with unknown financier BnP Capital to raise R15-billion to consolidate SAA’s debt, for which the pair would earn a R256-million fee or 1.5% of the debt.
O July 6: Disclosures made by senior airline executives to unions contain allegations of boardroom lies, corporate subterfuge and purges. The submissions allege that Jarana is behind the suspension and dismissal of executives who differ with him. SAA dismisses the allegations as a smear campaign.
O July 20: The treasury, SAA’s shareholder, asks the airline to account for an alleged R5.5-million package for interim chief financial officer Robert Head, its expenditure on consultants and for breaking its shareholder compact by dismissing and appointing another chief financial officer. —