Government scraps sale of South African Airways (SAA)
The South African Department of Public Enterprises (DPE) has announced the termination of negotiations by mutual consent for the transaction to sell a controlling stake in South African Airways (SAA) to the Takatso Consortium.
Minister of Public Enterprises Pravin Gordhan explained during a media briefing on 13 March 2024 in Cape Town that while three years ago, a valuation of SAA’s business and assets had been reached, circumstances have now changed – prompting a disagreement on the revised transaction structure.
According to Minister Gordhan, the South African Government is convinced that South African Airways (SAA) can sustain itself for the next year to 18 months and there are various, other ways in which immediate financing can be obtained. He further said that at no stage, in the course of the months that come, will SAA get money from the fiscus. South African Airways (SAA) will revert to being fully state-owned.
The deal between the South African Government and the Takatso Consortium originates from June 2021, when the Takatso Consortium was named as SAA’s new Strategic Equity Partner (SEP). The SEP would privately own a 51% stake in SAA while the South African government would hold the remaining 49%. Prior to the deal, South African Airways (SAA) was forced to enter into business rescue proceedings in December 2019.
