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South African defence firm Denel expects state aid in Q3

JOHANNESBURG, Aug 2 (Reuters) - South Africa's Denel is set to receive government cash in the third quarter of this year to aid its turnaround, the state defence company said on Friday, adding it saw potential to cut costs by a further 500 million rand ($34 million).

Denel last month asked for a 2.8 billion rand cash injection to help it emerge from a financial crisis, and said it was talking to the Department of Public Enterprises (DPE) and the National Treasury (NT) about the process.

"The DPE and the NT have indicated that they are satisfied with the progress Denel has made on the recapitalisation conditions and the recapitalisation is expected during the third quarter of the year," Denel said in a statement.

($1 = 14.7049 rand) (Reporting by Alistair Smout; Editing by Mark Potter)