The SAA will be officially under business rescue from today. That was the consensus between the legal teams of Solidarity, the SAA, the Minister of Public Enterprises and the Minister of Finance during a meeting with the Deputy Judge President of the South Gauteng High Court.
During the meeting, the SAA undertook to ratify a resolution, that the SAA voluntarily be placed under business rescue, with the Companies and Intellectual Property Commission (CIPC) today. If this is not done, Solidarity’s business rescue application will be heard on 13 December.
This comes after it became known that the SAA Board passed a resolution at midnight last night to voluntarily place the SAA in business rescue. This followed Solidarity’s request to the High Court that the trade union’s application for business rescue of the SAA be heard next week.
“This is a historic event. It is the first time that a public enterprise is placed under business rescue. The business rescue process also shows that mismanagement and plundering actually do have an end date – in this case at great cost.
“However, this is not a voluntary business rescue process; it was enforced by Solidarity’s application. The government is now trying to obtain more control over a process they had been opposed to in the past. Solidarity will request the other trade unions to jointly demand that organised labour should have influence in the appointment of the business rescue practitioner.
“However, we welcome the business rescue process. This is a victory for Solidarity and taxpayers,” said Solidarity Chief Executive Dr Dirk Hermann.
On 21 November 2019 Solidarity launched a first-of-a-kind business rescue application in terms of section 131 of the Companies Act, No 71 of 2008, seeking an order to place SAA under supervision and to commence business rescue proceedings. SAA and the Minister of Public Enterprises gave notice of their intention to oppose the application. To date, no opposing affidavits have been filed.
During the course of Wednesday evening news surfaced that government (as SAA’s sole shareholder) has changed its position and now agrees that SAA should be placed in business rescue.
The fact that the company adopted a section 129 resolution in terms of the Companies Act means Solidarity can no longer proceed with its pending application given the wording of section 131(1) of the Act which stipulates that: “Unless a company has adopted a resolution contemplated in section 129, an affected person [such as Solidarity] may apply to a court at any time for an order placing the company under supervision and commencing business rescue proceedings.”