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SA Express bidder requests 100 days to come up with funds to buy airline

Missed previous deadline.
With an extension and a ‘letter of no objection’ the worker-owned group says it will be able to launch its equity crowdfunding campaign. Image: Tod Burns

In a last-minute bid to purchase state-owned airline SA Express, worker-owned consortium Fly SAX has requested an additional 100 days to raise the funds to complete the transaction.

Fly SAX won the bid to purchase the beleaguered airline from the government in September last year for R50 million; R24 million has been raised through a sale of the airline’s assets, leaving a balance of roughly R26 million which would be paid through a bank guarantee. 

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The consortium has however failed to raise the funds required, meaning the airline will likely go into final liquidation.

In January the airline’s provisional liquidation was extended to April 29 to allow for the conclusion of the shareholding agreement between the provisional liquidator and the government.

Read: SA Express provisional liquidation given four-month extension

Crowdfunding

Fly SAX spokesperson Thabsile Sikakane told Moneyweb that the consortium has requested that the airline’s provisional liquidator give them the additional time to raise the funds through equity crowdfunding as envisaged in the bid offer.

“This is only possible if the provisional liquidator gives us a letter of no objection and 100 days extension. This process would enable us to meet the requirements which are set as conditions to be eligible to be listed [on] the Uprise.Africa equity crowdfunding platform,” she said. 

Read: SA Express workers secure two anchor investors

The consortium is still waiting for approval from joint provisional liquidator Aviwe Ndyamara on whether or not their request will be accepted. Ndyamara had not responded to Moneyweb’s queries by the time of publication. 

On Sunday, Ndyamara said the airline’s provisional liquidators, Tshwane Trust, would still consider offers to purchase the airline from a “realistic buyer” and if “proof of funding is provided together with the offer to purchase”.

‘Opportunistic claims’

“The liquidators have received several opportunistic claims, none of which have materialised and no bidder has been able to provide proof of funding,” Ndyamara said in a statement. 

Ndyamara has reopened the opportunity for interested buyers to buy the airline despite SA Express’s previous liquidators, Go Industry Dove Bid, closing the expressions of interest in July last year. 

“The liquidators and the advisors to the liquidators being Go Industry Dove Bid, assessed the expressions of interest received and advised all of the parties that they had until 11 August 2020 to provide 10% deposit of their indicative offer, as per the expression of interest, and it was to be deposited into an attorney trust account (of their choice) indicating the funds are to be ring-fenced for the transaction,” Ndyamara said. 

Earlier this month, Moneyweb reported that aviation company Fly Modern Ark had sent Ndyamara and Public Enterprises Director-General Kgathatso Tlhakudi an unsolicited offer to buy the airline for R1. 

Read: Is SA Express worth R1?

Ndyamara however said the aviation company has not formally brought forward a bid to purchase the airline, adding that “no deposit or proof of funding has been put forward”.

“Fly Modern Ark had not provided the liquidators with a tangible offer, proof of funding and did not adhere to the terms and conditions of the sales process,” he said.

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And their new executive will demonstrate their airline capability by folding paper airplanes.

If they’ve had to crowdfund to raise capital for the purchase, how in hell will they finance the operation of this airline? I can only assume they are purchasing assets which they will then onsell at a profit and have no intention of actually running a business!

it can be given 10000 days to come with funds to buy the airline, but if nobody to date has come up with “realistic offers” as defined by the airline’s provisional liquidator, don’t they get the message from the private sector side: “nobody is interested in an already struggling business and another sa stillborn airways” it simply has no market place

This ‘crowd funding’ baffles me a bit. Where is the ‘crowd’? Who is the ‘crowd’? Do the crowd even know that they are supposed to came and fund Fly Sax?

Maybe it’s the Crowd1 investors?

Yes. Shame. These people need help!!

Not with money.

For sure: not with money….

Let them strike for more funds.

“R24 million has been raised through a sale of the airline’s assets,”

Please help me here, how do you sell off the asset you are purchasing before you have purchased it and use those funds to purchase the asset you just sold????

Then the purchase price was not R50m but R26m and no funds have been raised??

What are they buying exactly? Just the name, and whatever licences SAX may have?

IV JUST SENT A COMMENT ASKING THE SAME THING. THIS DOESNT MAKE ANY SENSE

I recall, although I do not claim to have precise facts, that this is the sort of financing model that the Guptas and Zumas used: Buy Optimum coal mine, at a massively subsidised cost to the buyer, bur=t at an exorbitant cost to the seller, on money “lent” by the seller, financed by the state (meaning the taxpayer), the borrowed amount to be never repaid, the asset to be commandeered, al further taxpayers expense, the legal issues fiddle=d, again at taxpayers’ expense. Not to consider the backhander commissions going to the cadres.

Never resolved.

Sounds familiar?

Maybe the buyer is waiting for the Reserve Bank to return the “billions donated” to Tokyo Sexwale to buy SA Express. A scammer using an existing scam to buy another scam.

We will all feel better if we see all these shenanigans by ANC cadres as a public IQ test. They reveal their level of intelligence with everything they say and do. Considering the testimony before the Zondo Commission in combination with the bankrupt SOEs and municipalities and the record-high unemployment rate, then Luthuli House is a mental infirmary for intellectually handicapped individuals.

It is impossible for individuals of inferior mental capacity to realize that they lack understanding and insight. They are unaware of their own stupidity and ignorance and they move forward with conviction and resolve. They make these stupid and careless mistakes and leave evidence of their malfeasance everywhere. Intelligent people present all the evidence in the books and articles they write about them. Then, the individual of inferior mental capacity motivates his followers, who are even more stupid, to burn those books.

People with an IQ below 80 are classified as untrainable by the US army and seen as a risk to fellow soldiers. We have them as our leaders in South Africa. They fill the top structures of the ANC.

& those are the bright ones

Sensei, this latest Tokyo scheme is quite clever.

Before anyone smells a rat you rant and rave about how someone stole the money, the honest Joe act. He did let slip it was someone very important……..maybe he rates himself a bit?

Occupants of the mental infirmary you so well describe are prime candidates for supporting the validity of the Dunning-Kruger study.

Seen this movie before in the investment world…

BEE consortium comes in at the best “offer”, gets the bid, then runs around with the agreed term sheet looking for funding on the back of all kinds of ridiculous claims on their expertise.

Some fool such as the IDC or PIC agrees to fund the BEE consortium.

Deal happens…but money is shortly squandered…

Fingers are pointed, mainly at WMC for creating unfair business environment…

Yawn…

Remember Aurora mine? Couple years back….

A few infamous names involved too…..

Why doesn’t the IDC fund them?

Try BackaBuddy as a last resort …

crowd funding to finance an airline, wow, how on earth are they going to finance the day to day running of an airline. clearly these people have no aviation knowledge or experience. you cannot crowd fund everything month to pay rent and salaries

And BONUSES!

Bonuses paid first, Jet A ! later if possible..

“Fly SAX won the bid to purchase the beleaguered airline from the government in September last year for R50 million; R24 million has been raised through a sale of the airline’s assets, leaving a balance of roughly R26 million which would be paid through a bank guarantee. ”

PLEASE HELP ME UNDERSTAND HOW THE COMPANY THAT IS SUPPOSED TO BE BUYING SAX WILL BE ABLE TO USE THE R24M THAT IT RECEIVED FOR THE ASSETS SALE AS A DEPOSIT AND ONLY HAVE TO COME UP WITH A FURTHER R26M????????????

SURELY THIS IS NOT RIGHT?

Why is Moneyweb publishing such insignificant rubbish? In the SA aviation space there is presently critically important stuff going on – like SAAT staff not being paid, yes, SAAT that maintains and services SAA, Mango and a host of international and regional airlines’ planes;
Surely that’s far more important for the public to know about than SA Express which doesn’t fly any more?
SAAT and Mango, both subsidiaries of Gordhan’s SAA, are seemingly now ALSO hitting the dwang like SAA; we’re talking about the mechanical arm of SAA – how badly is safety of aircraft affected by this development of the past 10 days?
Moneyweb, please wake up – SA Express is NOT presently an issue compared to Mango and SAAT!

Yet another CLUSTERF^%$k in the making….If you are so keen to fly, jump off Table Mountain! F’ing morons.

Where is the fairy funding godmother when we really need her?

End of comments.

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