This is DBSA's response to SAA related media queries.
DBSA approved a ZAR3,5bn Equity Bridge Facility to SAA (Facility). This seeks to bridge the stated intention of the South African Government to recapitalise the airline. It is secured by way of a government guarantee, issued in accordance with the regulatory framework.
Terms and Conditions of the Facility
The terms and conditions of the Facility are market related. As is customary for transactions of this nature, the Facility is subject to comprehensive confidentiality provisions. In light of this, DBSA requests that information relating to the terms and conditions of the Facility be directed to the Business Rescue Practitioner, National Treasury or the Department of Public Enterprises who are best placed to respond.
DBSA Mandate and Rationale
The Facility is granted in line with DBSA’s economic mandate and the objectives set out in the DSBA Act. The Facility seeks to support the Business Rescue Process in ensuring the orderly and controlled restructure of SAA thereby preventing unnecessary destruction of economic value in the transport sector, a key focus area of the DBSA.
The Facility was approved by the Bank’s Board Credit and Investment Committee, in full compliance with the Bank’s internal credit approval process.
The Facility was subjected to the DBSA’s established governance, credit evaluation and approval processes. The DBSA subscribes to the highest standards of corporate governance. Consistent with this principle, the Chairman of the Board of the DBSA did not contribute to, nor participate in the transaction.
Impact of the Facility, if any, on the operations of the DBSA
The granting of the Facility has not impacted the ability of the DBSA to execute on its development objectives and mandate. The DBSA continues to manage its balance sheet within its policy framework.