South Africa’s government announced Friday plans to sell a majority stake in cash-strapped flag carrier SAA to a consortium that includes the operator of a local budget airline, effectively privatising it.
Public Enterprises Minister Pravin Gordhan announced on Friday that Takatso Consortium would own 51% of the airline while government would retain a 49% ownership.
SAA, Africa’s second largest after Ethiopian Airlines was placed under a state-approved rescue plan in December 2019 in an effort to save it from collapse.
The airline, which recently exited a business rescue plan, will effectively be privatised as investors will hold a majority stake.
“Having evaluated the current environment, government has agreed to the (strategic equity partner) owning of 51 per cent of the shareholding and government 49 per cent,” Public Enterprises Minister Pravin Gordhan said in a media conference.
The consortium includes Harith General Partners, an investor in African infrastructure and airports, and airline management firm Global Airways, an aircraft leasing firm that recently launched local budget airline LIFT.
Gordhan believes that with the partnership, the country is closer to achieving the important objective of having a sustainable national airline.
Takatso which translates to “aspire” in Sesotho will initially inject 3.5 billion rand into the airline.
The conglomerate chair Tshepo Mahloele said “the partnership represents a robust, exciting South African-bred solution”. Mahloele is the founder of Harith General Partners, which owns Lanseria airport in northern Johannesburg.
Takatso CEO and co-founder of LIFT Gidon Novick expressed confidence that SAA would turn into an efficient and innovative airline which will in turn catalyse the country’s economic growth.
During the briefing Novick said “airline models around the world are being challenged…We have the capital and financial insights of Harith”