PIC willing to invest in SOEs that 'meet right criteria'

The Public Investment Corporation (PIC) would consider investing in state owned enterprises such as South African Airways (SAA) if they met its investment criteria‚ its CEO Dan Matjila told parliament earlier today.

Matjila said the PIC's investment philosophy was based on two pillars: financial returns and sustainable investing.

The latter required companies to perform well in terms of environmental‚ social and governance (ESG) issues. State owned enterprises compared unfavourably with listed companies‚ which delivered a higher financial return and had better ESG scores‚ he said.

SAA is under the spotlight‚ as it has asked government for R13-billion in recapitalisation over three years.

It received R2.2-billion at the end of June‚ when government stepped in to repay Citibank‚ and a further R3-billion at the end of September to repay other lenders and provide working capital.

In the interim‚ SAA has borrowed funds from the National Revenue Fund. It was expected that the gap would be filled by the government selling its 39% stake in Telkom‚ valued at about R13-billion‚ but this fell through last week.

Treasury said last week that the plan for SAA would be provided in the Medium Term Budget Policy Statement on October 25.

-BusinessLIVE