NEWS
11/04/2018 08:41 SAST | Updated 11/04/2018 08:41 SAST

Board Change At Denel Brings 'Hope' For Staff And Management

A new interim board at Denel has instilled optimism in those employed by the troubled arms manufacturer.

South African Minister of Public Enterprises Pravin Gordhan.
Halden Krog/Bloomberg via Getty Images
South African Minister of Public Enterprises Pravin Gordhan.

The appointment of a new interim board at state arms manufacturer Denel has given staff and management " new hope", Eyewitness News (EWN) reported. This week, public enterprises minister Pravin Gordhan replaced the board at the beleaguered parastatal.

READ: Gordhan Appoints New Interim Board For Embattled Denel

Gordhan said the state-owned enterprise faced "the threat of collapse unless far-reaching decisions are taken urgently".

The new board members include Zoli Kunene, Professor Tshilidzi Marwala, General Themba Matanzima, Gloria Serobe, Talib Sadik, Sue Rabkin, Dr Sibusiso Sibisi, Cheryl Carolus, Nonzukiso Siyotula, Thami Magazi and Martin Mnisi.

Denel's group executive for communications and public affairs, Vuyelwa Qinga, reportedly told EWN: "They are people who come with very strong backgrounds and there's also knowledge of the defence industry."

Gordhan told Radio 702 talk show host Karima Brown that the interim board would "recapture" Denel.

He told a press conference in Irene on Monday that Denel had had a good reputation, but that reputation had been lost, according to Mail & Guardian. Gordhan reportedly said the new interim board would spend the next few weeks studying Denel's financial results.

The cash-strapped arms manufacturer faces major liquidity problems and now it cannot produce bank guarantees to secure contracts, causing an exodus of engineers, Times Select reported.

Denel reportedly cancelled an order of 1,000 missiles worth more than R1-billion because it reportedly could not set up a production line or provide a bank guarantee.

Denel subsidiary Denel PMP reportedly could not pay its staff's salaries in December, but the treasury came to the rescue, providing R580-million to pay suppliers. On Friday, 900 staff members were told they would be put on a four-day work week because of cash flow problems at the company, Times Select reported.