State-owned arms manufacturer, Denel says National Treasury gave the company a R1.8 billion re-capitalisation, adding that it would contribute to its comprehensive turnaround strategy.
Group Chief Executive Officer, Danie du Toit says the lifeline came on the back of tangible progress of detailed plans to restructure the business, enter into strategic partnerships and find new markets for its high-technology products and solutions.
He says the allocation forms part of a R2.8 billion request, of which the additional R1 billion will be considered in the 2020/21 budgetary process.
Du Toit says the allocated portion will enable Denel to improve delivery performance and support to local and international customers.
During the 2019 Appropriations Bill debate in July, Finance Minister Tito Mboweni announced the commitment to recapitalise Denel as it tries to mitigate its liquidity challenges.
The cash-strapped entity applied for recapitalisation which was provided for in the contingency reserve in the February 2019 budget vote.
- African News Agency
