Considering the airline's recent, alleged failings in a Civil Aviation Authority audit last week, a capable partner may be its quickest route to rebuild.
Public Enterprises Minister Pravin Gordhan is expected to announce the long-awaited strategic equity partner for South African Airways on Friday.
Although there have been many rumours, a well-placed source has hinted low-cost airline newcomer Lift is mooted to be it.
Lift accesses its fleet from Global Aviation, with a ready-to-roll narrow and wide body Airbus fleet of 10 aircraft.
The deal is still subject to a due diligence process. Jonathan Rosenzweig, chair of Global Aviation, declined to comment and a representative of Harith Investments, a shareholder in Lanseria International Airport, also declined to comment, adding that he “knows nothing about it”’ and then hanging up.
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After this, two other insiders shared with The Citizen, independently, that Global/Lift were the likely suitors, one noting that he was aware “of conversations between public enterprises and Global/Lift stretching as far back as six months ago”.
SAA was approached via WhatsApp for comment and the response was “NO” in capitals. Public enterprises spokesperson Richard Mantu said: “I don’t know what you are talking about.”
Lift founder Gidon Novick’s phone was unanswered and “lead conversation architect” Monique Thompson promised to call back after five minutes, but did not.
When The Citizen called again, she hung up after a few rings. Should a Global/Lift “strategic equity partnership” transpire, one analyst asked whether this was all that could be achieved in nine years since the notion of a strategic equity partner was first raised to public enterprises, but initially rejected, in 2012.
“It will certainly get SAA back into the air, but this is not a strategic equity partnership. Lift is only a few months old and has zero experience in mainline aviation, geopolitics and other complexities that surround a flag carrier.”
Considering SAA’s recent, alleged failings in a Civil Aviation Authority audit last week, a partner with a fleet, crew and pilots may be its quickest route to rebuild, too.
Aviation analyst Guy Leitch said that “if as suspected the strategic equity partner is Global, it is very good for SAA as Rosenzweig runs an extremely tight ship and will bring much needed discipline.
“If the additional funding comes from Harith, it will be a pity as it may be just a further application of government funds. However, Harith has made a success of its Lanseria Airport investment. The big question, though, is how Global and Harith will limit political interference.”
Santaco has been rumoured to be a potential equity partner, too, said to weigh in at a possible 30%.
In addition, a joint venture between Qatar Airways and Emirates was listed as another possible strategic equity partner. This will see government retaining a minority stake in the business. Santaco, Emirates and Qatar will then acquire 40% in a joint venture.
This leaves Gordhan’s department with 30%. Santaco and aviation were linked before a few years ago. It amounted to naught. Emirates took the equity investment leap once 23 years ago and invested in Sri Lankan Airlines.
It ended in tears and CEO Sir Tim Clark vowed to never take equity in an airline again. Qatar and International Airlines Group frequently invest in airlines and may well be on the lookout for Covid-impacted bargains.
But is SAA, broken and with a meddling shareholder, still a bargain? A very public partnership between the UAE and Qatar to invest in SAA is also highly unlikely.