No money will be released to keep SAA in the sky, says Gordhan

CAPE TOWN - Now that a private partnership deal has been set off the table, the Minister of Public Enterprises, Pravin Gordhan, says no money will be spent from the fiscus to keep South African Airways (SAA) in the sky.

Gordhan announced on Wednesday that the more than three-year-long communication with the Takatso Consortium ran its course, and the deal wouldn't proceed.

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However, he believes that given its current operational performance, the airline can survive for up to 18 months.

Talks for the 51% private equity deal with the Takatso Consortium finally crashed over SAA’s true worth.

Now valued at over R5 billion, Gordhan said it would not be in the public interest to sell a majority stake in the airline at its COVID-19 pandemic price value of just over R2 billion.

Despite the deal having fallen through, SAA still needs cash.

“At no stage, in the course of the months that come, will SAA get money from the fiscus - we want to make that clear.

“There’s no going back to the past, there’s no reliance on government itself. It must run its operations as efficiently as it can, and as profitably as it can,” said the minister.

Gordhan said the airline would look at other ways to raise equity and turn its focus to implementing its corporate plan and expanding its route network.