A 'unique' operating model: 51% of SAA to be sold to Takatso Consortium
Fifty-one percent of SAA will be sold to a consortium, while the Department of Public Enterprises will own the other 49%.
CAPE TOWN/JOHANNESBURG - It’s official - a newly configured South African Airways (SAA) will be jointly owned by government and a strategic equity partner.
The new SAA will be majority owned by the Takatso Consortium, which means “aspire” in SeSotho, with a 51% shareholding. The South African government will hold the remaining 49%.
In a statement released on Friday morning, Takatso Consortium said it was chosen to partner with the Department of Public Enterprises to keep the ailing airline in the air.
Public Enterprises Minister Pravin Gordhan also addressed the media on Friday morning, explaining the deal.
SAA was placed under business rescue about two years ago following management and financial challenges. Government has been under increasing pressure after bail outs totalling billions of rands.
The consortium, made up of Harith General Partners (which owns Lanseria Airport) and Global Aviation, will own 51% of the national carrier.
Gordhan said the new airline would see an end to government having to pour money into the airline to save it.
“This is a demonstration of South Africa’s ability to develop an entirely homegrown solution to successfully relaunch SAA as a sustainable, competitive and transformed airline. And once again, so we understand this clearly, this airline is not dependent on the fiscus.
Harith co-founder and consortium chair Tshepo Mahloele said the venture would bring the best of South Africa together, adding that the consortium had the experience, expertise, and capital to transform SAA into a substantial business.
"We have deployed more than a billion dollars into a portfolio of critical infrastructure assets across the African continent that support regional economies," Mahloele said through the statement.
"Global’s [Aviation] operating model is unique, highly efficient and fit for purpose for a newly launched airline," the statement said.
Takatso CEO, former Comair Co-CEO and recently co-founder of Global’s airline LIFT, Gidon Novick, said efficient, customer service and innovation was central to the business plan to assist with the economy's growth through tourism.
Novick added South Africa had "an abundance of low-priced aircraft available globally, and that transformation - both critical ingredients for a successful airline, and that transformation would be a core pillar, "including accelerated training and promotion of qualified black pilots and a broad-based employee incentive scheme".
"A due diligence exercise will now get under way. Once completed, further details will be outlined on key issues such as the route network rollout, fleet selection, leadership team, transformation, brand relaunch, technology, SAA’s subsidiaries, global partnerships and Voyager," the statement ended.
Gordhan said board seats would be allocated in proportion with ownership and the composition of the management team would take into account the country’s transformational agenda.
Meanwhile, the National Union of Metal Workers of South Africa (Numsa) and the South African Cabin Crew Association have noted the announcement on SAA, accusing the Department of Public Enterprises of not being transparent about the process.
The unions said they had been enquiring about the process since last year, adding that this was important to note as SAA was collapsed by mismanagement and rampant corruption - which happened under the watch of the department and Gordhan.
Numsa national spokesperson Phakamile Hlubi-Majola speaks on behalf of both unions.
“If we are to make a break with the past, then transparency is a key factor in ensuring good governance and ensuring that the same problems which brought down SAA are not repeated. It is also important to remember that workers paid a very high price through job losses for the restructuring of SAA – 3,500 loyal, hard-working, passionate employees have been let go in the process.”