‘Due diligence, not red tape’: Ntshavheni on SAA-Takatso deal being called off
Both parties officially called it quits on the three-year long negotiations to sell a 51% stake of SAA.
A South African Airways Airbus A330 airplane. Picture: Nicolas Economou / NurPhoto via AFP
CAPE TOWN - Minister in the Presidency Khumbudzo Ntshavheni is refuting suggestions that government red-tape, scuppered the private equity deal between South African Airways (SAA) and the Takatso Consortium.
Reporting back from Cabinet in Parliament on Thursday, Ntshavheni said the executive supported the decision for the Department of Public Enterprises to can its negotiations to sell a majority stake in the national airline.
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On Wednesday, Minister Pravin Gordhan said the decision was not as a result of political pressure, but rather considering SAA’s increasing worth.
Both parties officially called it quits on the three-year long negotiations to sell a 51% stake of SAA.
Ntshavheni said Cabinet accepted that SAA was worth at least R3 billion more than at the height of the COVID19 pandemic when negotiations started with the Takatso Consortium.
“It’s very disingenuous for Takatso to call the Competition Tribunal process red tape. It is not red tape, it’s part of the due diligence that is required.”
The Tribunal required that the Consortium to divest of its minority shareholder, which is also in the aviation industry.
“SAA will continue to operate as a government-owned entity, and will continue to operate in its current form for the short to medium term.”
On Wednesday, Takatso said the proposed revised transaction was simply not workable for its business, and the Competition Tribunal’s divestiture condition was too cumbersome to proceed.