Is South Africa Airways now privatised? This is the overriding question following a briefing by Public Enterprises Minister Pravin Gordhan earlier today on the status of SAA.
The ailing entity has been bailed out by government on several occasions following continued mismanagement before being placed under business rescue at the end of 2019. Now Takatso, which is a new Consortium of majority Black-owned enterprises Global Aviation and Harith, will be taking up a 51 percent equity in SAA, with government’s stake in the company is reduced to 49 percent.
Along with the changes in equity, Gordhan confirmed that SAA will continue to house its core operation in South Africa, along with an injection of R3 billion incoming from Takatso.
“Government and the ANC has indicated over some time the intention to restructure SAA. The airline was placed into business rescue in December 2019 and since then our objective has been to ensure a viable and competitive airline and once launched, not reliant on the fiscus,” explained Gordhan.
The minister added that it is vitally important for SAA to work on growing intra-Africa aviation and one of the mandates it now has is to connect and build a network within the African continent.
This sentiment was shared by Gidon Nivock, CEO of the Consortium, who said that, “It could be the best time ever to launch a sustainable and iconic new airline.”
“Harith, as owners of Lanseria International Airport, has significant experience in the transport infrastructure and aviation sectors. We have deployed more than a billion dollars into a portfolio of critical infrastructure assets across the African continent that support regional economies,” added co-founder and Consortium chair Tshepo Mahloele.
As for the next steps in the process, Gordhan said that new board seats will be allocated according to ownership status following due diligence. He added that government will have a non-dilutable “golden share” of 33 percent in SAA, so it may not be state-owned, but will certainly feature a heavy state influence.
That said, it looks like the Consortium has plans of its own for the company, noting that, “as one way of addressing future funding requirements and to enable all South Africans to take part in its success”.
It is therefore an intriguing time for the future of South African Airways, especially given the added turmoil that the pandemic has placed on the travel and tourism industries both locally and abroad. Either way, it begins an important new chapter.
[Image – CC BY-ND 2.0 GovernmentZA on Flickr]