The long-troubled Denel received a boost in its restructuring efforts when the South African government agreed to recapitalize the ailing firm with a ZAR3.4 billion injection in late 2022. The slide accelerated toward a cliff edge during the COVID-19 pandemic with fears that the company would be placed under business rescue – South Africa’s version of bankruptcy protection. In addition, the company would reduce its facilities’ footprint and divest non-core operations as part of the program as well. If the restructuring is successful, Denel could be well-positioned to take advantage of the growing global defense market. While it was not easy for South Africa’s government to swallow, the capital injection is the best hope for Denel’s recovery.

Source: The North Africa Journal May 15, 2023 10:01 UTC