Potential funders for SAA put their hands up

And no one asked them.
SAA Restructured must be "viable, sustainable and competitive" according to government. Image: Supplied

The Department of Public Enterprises (DPE) says it has received voluntary proposals from private sector funders, private equity investors and potential airline partners interested in investing in a new, restructured South African Airways (SAA). 

This announcement comes just days ahead of a meeting where SAA creditors will vote on whether to adopt the airline’s business rescue plan, which will see the government commit to raising R10.3 billion to launch SAA Restructured. 

It also comes just a day before Finance Minister Tito Mboweni is due to table his emergency budget, in which commentators have said he will have to provide clarity on whether the government will fund its commitment to having a national carrier. 

An environment ripe for partnership

The DPE, which is the shareholder representative of the airline, said that it will engage with those interested in funding the airline “constructively in pursuit of government’s national developmental and strategic agenda to rebuild our economy in a postcode-19 era.”

“Government is intent on pursuing credible proposals for investment and strategic partnerships with the private sector, as well as equity participation for employees,” the department said in a statement. 

“Such partners will also introduce technical, financial, and operational expertise.”

The DPE said due to the pandemic and subsequent travel restrictions, airlines across the globe have seen a severe drop in flights – placing many of them in financial distress

“Therefore, there are possibilities for airline partnerships to improve scale and scope and ensure continuity of value creation to the South African economy and long-term sustainability of the aviation industry.”

SAA rescue practitioners Les Matuson and Siviwe Dongwana stated in their business rescue plan that engagements with strategic equity partners – which were underway prior to Covid-19 bringing the aviation sector to its knees – would be “revived once the global aviation industry is back on its feet.”

No more of the same 

SAA has been under severe financial distress over the past ten years and has not made a profit since 2011, incurring R27 billion in losses since 2012.

In addition to supporting an airline with no financial hangovers, the government said the new airline would need to have a competent board of directors with aviation skills, a modern and efficient fleet, a motivated workforce, technological agility and a service with the right routes and competitive prices. 

“Government has expressed its intent and commitment to fundamentally restructure and transform SAA into a viable, sustainable and competitive national carrier.

“The broader aviation industry and the passenger air transport sector specifically, is essential for servicing and growing economic sectors, including tourism, business connectivity and cargo carriage,” it said.

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Could be a good solution as long as DPE is a minority shareholder and the playing field is level for other airlines.

We all know that the two major problems with SAA has always been political interference and incompetent management. Although private capital may insist that their voices be heard in the management of SAA, political interference will always be lurking in the shadows.

And that would make it a fascist organisation so no difference really.

Already the playing field has VERY recently been rearranged by the BRPs to ENSURE the DPE/SAA has market advantage over private competitors; tax payers’ money (R1bn) originally earmarked to resurrect SAA was diverted to its subsidiary, Mango, which unlike SAA, does make profits!
It shows how the DPE, via the BRPs, says one thing but does another – not trustworthy.
It further shows how the DPE uses Mango to create an unequal playing field for the likes of FlySafair which along with Mango, are now flying domestic routes for the first time since March due to lockdown. FlySafair and other aviation business received not a penny by way of government Covid relief while they ALL suffered from the lockdown! It justifies an immediate consumer boycott of Mango untill all aviation businesses get a R1bn in Covid relief money!

No one in their right mind would invest in SAA ii without having a say in how the airline is run.

Covid 19 was not responsible for the demise of SAA – this must be laid at the feet of the DPE – Pravin especially, and Zuma to some extent for entrusting Dudu with the keys of the safe.

Whereas, this has been a “National ” carrier for so long, the poor taxpayer has had no say in its shambolic administration.

Who on earth in the private sector would want to partner with our Commie ANC government ? Guptas perhaps ?

Honestly can’t imagine who else!

Probably any person/s keen on getting a slice of the CMC pie. (i.e.Cadre Monopoly Capital) Guptas certainly have proven to be in that category.

And then came the unions…………………QED.

Well, golly gosh! Since so many people have so much cash lying around to spend, let them have it! Including the debts and relieve the taxpayer of this albatross.

With apologies to sea birds…

I’m glad you apologised to the elegant sea faring bird, which soars effortlessly and efficiently in the skies above. Maybe one should rather compare this parasite to the infamous Trafalgar Square pigeon. It loiters around constantly demanding feed from the locals flapping its flea infested wings occasionally in the shadow of Nelson only to turd the white stuff all over the heads of the hands that feed them.

I’ve got 10 bucks to spare so I should also put my hand up.

Maybe they also want bailout money.

Note what the DPE has to say – Gordhan, in other words; government’s “developmental” agenda…Oops! Sounds like more of the old. A leopard doesn’t change its colours. Especially not when it comes to size of shareholding and level playing field!

Hahahaaa.

Maybe ANC voters will believe this rubbish.

When someone runs after you offering you money the intention is nothing else but to rip you off. They do this because they know you are stupid enough to fall for it.

Much like its too good to be true??

Whahahaaaaaa!!!!!!!!!!! Old Pravin Gupta has turned into a real joker.

0. That is how much confidence I have that this will work. Absolutely nada. It will be puffed up by politicians as the best thing to happen to SAA since it’s inception. It will be floated as exactly what South Africa needed to “revive” the struggling SAA as a beacon of national pride in the air. And then, give a couple of years, the reports of corruption, pillaging, and squandering of money will surface once more. Here is my promise; no state-owned enterprise has been successful since the commencement of the new democratic era in SA – and it will not change, it will only get worse.

It’s a no-brainer for any “potential investor” – you simply have a call option on an airline, knowing that the SA taxpayer, through the SA government will bail you out should things not work out. Government can keep it’s socialist policies going and the Unions won’t complain as they will still get their fees. It’s more of the same with government continuing to take us for a ride, regardless how obvious it is.

Private investors buying an interest in SAA is like turkeys voting for Thanksgiving, or a pig buying an interest in a bacon manufacturer.

That just summed up SAA Affairs guys thanks Sensei, I laughed so hard now

Name them please.

I wouldn’t put it past Jimmy Manyi’s lot who bought the New Age and ANN7.

Propaganda plain and simple.

Of course there are NO INVESTORS. There is not an airline investor in the world right now, that is loaning money to an airline without a government guarantee attached.

Seen as that is how SAA has stayed afloat for the last 20 years, it will be no different this time. But it sounds good to joe six pack, angry with the ongoing ZAR bonfire that is SAA.

So these “ASTUTE” investors will line up, why not. They can borrow locally at around 4.5%, charge SAA/ or PHOENIX AIR 12% plus fees. Make obscene returns, all with a written government guarantee – they cannot lose.

Potential Funders – replace the term with – Potential Vultures.

The next round of ANC apologists complicit in the current state of SAA, will gladly line up again – repeat. Have you contacted NEDBANK yet for comment? I am sure they have already prepared their glossy presentations, for round 17 of funding, or is this 18.

Total funding required to settle old guarantees (they have to pay these, otherwise a guarantee in future is worthless) and new funds required will total not less than R25 billion. For the consortium lining up – that is modestly at 1.5% fee’s R375m off the bat. Then on profit from the interest rate differential scored on lending to a ‘distressed’ client and the assumed ‘risk’ of which there is none. Ensure that there is a profit margin of about R1.75 billion a year to be made off this.

The small incentives get delivered weekly in suitcases allegedly. The large incentives land up in Dubai, Malaysia and Singapore again allegedly.

So yes i do sincerely believe, that there is a group of selfless patriotic funders raising their hands to save jobs and make SAA great again.

“SAA has been under severe financial distress over the past ten years and has not made a profit since 2011, incurring R27 billion in losses since 2012”.

Investor – Wow, This is a great opportunity!

The ANCministers just want their perpetual free flights.

La Looting Continua.

Good luck to paying off the debt.

End of comments.

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