South Africa is in talks to sell a controlling stake in Denel to Qatar in a bid to stave off finance woes for the cash-strapped state-owned arms manufacturer.

Qatar Defence Minister Khalid Bin Mohammed Al-Attiyah is believed to have discussed the proposed acquisition with President Jacob Zuma during a state visit to South Africa earlier this month, the Sunday Times has established.

It is believed negotiations for stakes in South African Airways and power utility Eskom are also underway, but this could not be confirmed by the Department of Public Enterprises or the Presidency.