South African Express (EXY, Johannesburg O.R. Tambo) is insolvent the carrier's management has said. During a parliamentary fact-finding mission to the airline's Johannesburg O.R. Tambo home base, SA Express's board admitted reports in the local press concerning the carrier's precarious state of affairs to be true.
According to a statement issued by Dipuo Letsatsi-Duba, the chairman of the South African government’s portfolio committee on public enterprises, while an interim agreement with South African Express' service providers has been reached, CEO Inati Ntshanga said efforts to secure additional funding via a bank loan had proven problematic given that a shareholder agreement was needed to secure the loan.
As the carrier has yet to hold its AGM on account of its financial records not yet being finalized, this could not be done resulting in an application to the country's National Treasury and Department of Public Enterprises, Ntshanga said.
In the meantime, while SA Express awaits a response, various cost-cutting measures have been enforced including wage cuts.
In early October, South Africa's Minister of Public Enterprises, Lynne Brown described SA Express' financial position as "extremely difficult".
The airline has been beset by allegations of financial mismanagement which culminated in Brown's predecessor, Malusi Gigaba, firing the carrier's board and external auditors in 2012 after they were unable to present him with audited financial statements at its then AGM.
