The question is if it becomes a success will the government let them keep it?


South Africa Sells State Airline to Private-Equity Venture

Loni Prinsloo and Paul Vecchiatto
Fri, June 11, 2021, 1:35 AM PDT
(Bloomberg) --

South Africa agreed to sell a majority stake in the country’s grounded national carrier to a local jet-leasing company and private-equity firm, ridding the government of an entity that has long been a drain on state finances.

A consortium comprised of Johannesburg-based Global Airways, which owns recently launched domestic airline Lift, and private-equity firm Harith General Partners will take a 51% shareholding in South African Airways, Public Enterprises Minister Pravin Gordhan said on Friday. The government will retain a minority stake.
The grouping named Takatso will invest as much as 3.5 billion rand ($258 million) over the next three years, Lift co-founder Gidon Novick and Harith Chief Executive Officer Tshepo Mahloele said in an interview.

“Government will have no further financial obligations to the company, outside of the existing liabilities that they will settle,” Novick said. “Route networks we are still working on, and it will be a phased roll-out based on demand re-emerging post Covid.”

Full story:

https://www.yahoo.com/finance/...state-072043780.html

I also found this.

JUNE 11, 2021 / 06:41 AM
South African government sells majority stake in airline SAA to consortium

JOHANNESBURG (Reuters) -The South African government is selling a 51% stake in South African Airways (SAA) to Takatso consortium, which will initially commit more than 3 billion rand ($221.60 million) to give the struggling airline a new lease of life.

SAA has been under a form of bankruptcy protection since December 2019 but its fortunes worsened during the COVID-19 pandemic and all its operations were mothballed in September 2020 when funds ran low.

The airline is one of a handful of South African state companies that depend on government bailouts, placing the national budget under huge strain at a time of rapidly rising debt.

The partnership with Takatso will alleviate that financial burden, public enterprises minister Pravin Gordhan told journalists on Friday as the state would no longer provide any funding to the airline, which exited administration in late April after receiving 7.8 billion rand from the government.

Gordhan added that the government will retain a 49% stake with the intention of eventually listing the airline to address future funding requirements.

“The objective of bringing in an equity partner to SAA is to augment it with the required technical, financial and operational expertise to ensure a sustainable, agile and viable South African airline,” he said.

The consortium includes pan-African investor group Harith Global Partners and aviation group Global Aviation, Gordhan said.

The airline’s subsidiaries will be evaluated, in particular Air Chefs, SAA Technical and the future of low-cost airline Mango, Gordhan said, noting that “anything can happen” when asked if some could be shut down.

SAA will continue to be domiciled in South Africa and the government will have a “golden share” of 33% of the entity’s voting rights and certain areas of national interest, Gordhan said.

In a statement, co-founder and consortium chair Tshepo Mahloele said it has the experience, expertise and capital to transform SAA into a substantial operating business.

“The partnership represents a robust, exciting South African-bred solution,” he said.

($1 = 13.5379 rand)

Reporting by Nqobile Dludla; writing by Emma Rumney; editing by Jason Neely, Kirsten Donovan

Fjold and Bwana338, Thanks for the Info. I am taking this move as good thing. Brian

When discussing any transaction involving the RSA government, there are three factors to keep in mind:

1) They are Communists and couldn’t turn a profit if it bit them in the ass;
2) They are totally corrupt;
3) They are totally incompetent