Denel will turn around, and we will pay salaries - CEO

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Denel's office in Pretoria (Reuters)
Denel's office in Pretoria (Reuters)

Minister of Finance Tito Mboweni’s commitment to recapitalising Denel gave the arms utility the confidence to announce on Wednesday that would be able to pay July salaries on time.

The utility released a statement on Wednesday saying it would be able to pay salaries for the month of July on time.

This comes after a statement on Monday, in which the utility said it could not guarantee the payment of salaries.

In the statement, Denel group CEO Danie du Toit said Mboweni's commitment to recapitalising Denel was a welcome development.

"These steps will contribute greatly to the financial turnaround of the company and the restructuring of our business which has been initiated by our new Board," said Du Toit.

The details of the bridging finance mechanism through which Denel accessed the finding to pay salaries remains confidential.

Du Toit confirmed that Denel secured July salary payments for employees following earlier concerns that salaries might not be paid out in full at the end of this month.

"The continued commitment of employees to Denel is highly appreciated and supports the wider efforts to turn the company around," he says.

The statement said Denel would continue to dispose of non-core assets and establish strategic equity partnerships across all of its divisions.

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