'We have assurance money will be there' - Gordhan on R3bn equity injection in the SAA Takatso deal

Public Enterprises minister Pravin Gordhan says government will make sure the Takatso consortium puts the required money on the table as the two consummate their partnership, which will see the consortium owning 51% of SAA.

“All of those issues and concerns might not exist and will be dealt with in the process once we go past the competition tribunal stage of the matter,” said Gordhan.

He was responding to questions from DA MP Alf Lees, who cited a Harith General Partners’ spokesperson saying Takatso Aviation has not sourced the R3bn working capital to the airline required in terms of its sale agreement.

“Since the Competition Commission’s recommendations, the minority shareholders are not going to go easily when they go to the tribunal, and there are suggestions that the state might have to buy them out. Is this something that’s being considered to make the deal go through? And what kind of value are we looking at?” asked Lees.

He claimed that the 20 percent of the 51% to the minority shareholders was sold for R8,16 (eight rand 16 cents) but the value of the airline after liabilities have been cleared was anywhere between R3bn and R10bn, depending on who you are talking to.

“As far as we are concerned, we have the assurance that the money will be there that will enable the airline to spread its wings, acquire more aircrafts either through leasing or other mechanisms, take on more routes, provide more competition to those who have filled up the vacuum while SAA, SA Express and Mango were not flying to particular routes and judging by the ridiculous fares in the process as well,” said Gordhan.

While he said the R8,16 was “completely misleading” he did not say how much the stake was sold for.

“This is a matter for Takatso to deal with. Their 20% shareholding is in Takatso, it’s got nothing to do with the state at all. So, there is no question of buying them off or paying them off. Let me be quite emphatic on that.

“This is a matter between two people or entities that arrived at some arrangement and they will sort out their squabbles.”

Gordhan said the matter should be handled by Takatso and the minorities and that’s a condition that has been imposed by the Competition Commission that the minorities should divest.

Minority shareholders of Takatso Aviation, which got the regulatory nod to acquire a 51% stake in SAA earlier this month, say they have not agreed to divest from the consortium, as per the Competition Commission’s conditions for the Competition Tribunal to approve the deal.

Takatso is majority owned by Harith General Partners, and the minority shareholders are Global Aviation Operations and Syranix.

Acting DG Jacky Molisane added that the money from Takatso can only come once the deal has been finalised and not while it is still going through the regulatory approvals.

Meanwhile, the Special Investigating Unit (SIU) said it was preparing to investigate complaints about the Takatso deal. The SIU said the allegations mainly had to do with interference in the administrative process in the department of public enterprises in selecting the company that was awarded the deal.