SAA closer to privatisation after Takatso deal gets thumbs up

The privatisation of South African Airways (SAA) has taken one step closer after the Competition Tribunal approved the acquisition of a 51% stake in the airline by Takatso Aviation.

The Tribunal on Tuesday said its approval is subject to a moratorium on retrenchments and disinvestment by Takatso’s minority shareholders and that it would release its reasons in due course.

The approval also marks a new era for SAA in which the government is no longer the majority shareholder.

Terms of deal

In terms of the Takatso deal, the consortium would gain 51% of SAA’s shares and provide the airline with a capital injection of R3 billion over two years.

The Department of Public Enterprises (DPE) as government’s shareholder would retain a 49% interest in SAA.

The DPE welcomed the Tribunal’s approval of the Takatso Consortium’s proposed purchase.

It hailed the decision as a significant step in the government’s efforts to consolidate the re-emergence of the national carrier as a “key strategic asset”.

ALSO READ: Gordhan denies he interfered in Takatso deal to purchase SAA

Boost SA economy

Public Enterprises Minster Pravin Gordhan said the Tribunal’s approval will benefit the country and its people.

“With this decision, the Competition Tribunal has affirmed our belief as government that a revitalised and a well-capitalised SAA presents the country with significant opportunities to boost economic connectivity and strategic reach that should benefit our economy and our people for years to come.

“I am confident that the repositioning of SAA sets a very good example of what can be achieved when the right financial and operational framework is given to state-owned companies so they can fulfil their mandate to advance our economic transformation and development as a country,” said Gordhan.

Competition

In May, the Competition Commission said if the merger went ahead with Global Aviation and Syranix, which co-owns the LIFT trademark, as minority shareholders of Takatso, the SAA deal would decrease competition in the domestic passenger airlines market.

ALSO READ: SAA’s ‘profit’ just doesn’t fly