Johannesburg – State-owned arms Denel faces the risk of being placed under a local form of bankruptcy protection called business rescue or even liquidation, National Treasury said on Tuesday.
Denel, which manufactures military equipment for the South African National Defence Force (SANDF) and clients around the world, has been struggling to pay salaries this year amid a liquidation crisis aggravated by the coronavirus pandemic.
In a presentation to Parliament, Treasury said that Denel was forecast to have had a negative equity position of R3.3-billion ($196.7 million) as of March 2020.
