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XINHUA NEWS SERVICE REPORTS FROM THE AFRICAN CONTINENT

 
South Africa dismisses reports on arms manufacturer sale

CAPE TOWN South Africa (Xinhua) -- A South African cabinet minister on Thursday denied media reports that the government has decided to sell a majority stake in the state-owned arms manufacturer Denel.

Such reports may send a wrong message to the industry and the financial markets during sensitive negotiations on Denel’s financial situation, Minister of Defence and Military Veterans Nosiviwe Mapisa-Nqakula said.

The Business Day newspaper reported on Wednesday that the government aims to optimize Denel’s financial position by selling a majority stake in the company.

The report attributed the speculation to a recent parliamentary reply by Public Enterprises Minister Lynne Brown who reportedly said that the government had not ruled out selling off its stake in Denel.

Financial strains confronted by the company have given rise to fears the it would not be able to pay salaries.

“As correctly indicated in the response by Minister Lynne Brown, there is no government decision on the matter and no options presented for consideration yet,” Mapisa-Nqakula said in a statement.

The report came as both the Department of Defence and its acquisition agency Armscor were engaging with Denel on its financial situation.

           

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