Johannesburg – South Africans and politicians have been left questioning the government’s latest decision of selling a portion of struggling state-owned airline, South African Airways (SAA).
Public Enterprises Minister Pravin Gordhan today announced that government has found a “strategic equity partnership” for the embattled national carrier South African Airways (SAA).
The deal will see a grouping called Takatso taking 51% ownership of SAA while government retains 49% of the entity. Gordhan said Takatso will inject R3 billion into a new SAA.
“The partnership brings together South African public and private sector capabilities to reposition SAA. We have looked long and hard at the proposals submitted, and our clear choice of a preferred partner is the Takatso Consortium…the new SAA will not be dependent on the fiscus,’’ the minister said.
The airline was recently allocated R10.5-billion “to implement its business rescue plan” by the government.
The entity has not made a profit in more than 10 years and has received numerous government bailouts throughout the years.
Also read: SAA has been privatised
The chairperson of the DA’s federal council, Helen Zille, said that the government had wasted R20 billion on the airline and has now been forced to give it away.
After wasting another R20-BILLION on SAA recently (and failing to turn it around) the ANC has finally been forced to give it away. They should have privatised properly decades ago when the DA proposed it. But NO! First throw away Billions. The DA is proved right once again.
— Helen Zille (@helenzille) June 11, 2021
Inkatha Freedom Party (IFP) leader, Mangosuthu Buthelezi, welcomed the sale of SAA.
He said, “The IFP welcomes the sale of SAA to a 51% equity partner in the private sector. This sale of SAA is a victory for the ordinary taxpayer who have been overburdened through multiple bailouts over a number of years. We hope that the turnaround strategy for SAA will come to fruition and that all South Africans can once again stand behind a successful SAA.”
IFP WELCOMES ANNOUNCEMENT OF SAA PUBLIC -PRIVATE PARTNERSHIP
The IFP welcomes the sale of South African Airways (#SAA) to a 51% equity partner in the private sector as announced by Public Enterprises Minister, Pravin Gordhan. – Inkosi Mzamo Buthelezi, MP pic.twitter.com/gbu4WPIsTV
— Inkatha Freedom Party (@IFPinParliament) June 11, 2021
Bantu Holomisa, a member of Parliament and president of the United Democratic Movement (UDM, was left with more questions than answers on the government’s decision to sell half of SAA.
Minister Gordhan sommer TELLS us 51% of #SAA is sold to, in part, #Harith. Remember them from #PICCommission?🧐
So many questions! Who were #Takatso's competitors? How was the deal structured & financed? How much this 51% stake worth & how is a mere R3bn is going save it? pic.twitter.com/T9twOEBId6
— Bantu Holomisa (@BantuHolomisa) June 11, 2021
EFF leader, Julius Malema, re-tweeted Holimisa’s statement on Twitter.
Take a look at how others reacted to the news on Twitter below:
How is “selling” 51% of SAA solving anything if the new “buyers”are not inheriting 51% of the debt and paying nothing for this 51%?
But because we have dumb financial journalists, they will not be asking the tough questions.
Government’s position has not improved in any way.
— Sentletse 🇷🇺🇿🇦 (@Sentletse) June 11, 2021
Are you gonna raise these questions in your next NEC meetings as Leaders of the ANC which took the decision to sell 51% of SAA for a measly R3bn while it makes R30bn revenue or you chasing clout? You people act as if you don't have power when you do nxhttps://t.co/9a2x2TBPB7
— Great Zulu👑 (@SuperiorZulu) June 11, 2021
Sans were misled into thinking that SOEs needs 2make an accounting profit because at school they were never taught abt economic profit. SAA was costing the State R2bn per annum but was the state losing money? Now 51% of SAA has been sold to Takatso for a song by Pravin
— Khandani Msibi (@KhandaniM) June 11, 2021
So it appears that 51% of SAA, a world class airline with an annual turnover of R30bn, which has been profitable most years and which the government recently bailed out and made fully liquid and solvent, has been sold for a meagre R3.5 billion? Is that the correct figure?
— Buddy Wells (@BuddyWells1) June 11, 2021
I am happy Government sold 51% of #SAA, but they should have done this years ago. We wasted money we didn't have. We desperately need a proactive Government instead of a reactive Government. Yesterday's decision about electricity should have been made years ago as well
— Lethabo (@MandelaMinutes) June 11, 2021
https://twitter.com/TokyoSexwaleSA/status/1403332924313899017?s=20
Follow @SundayWorldZA on Twitter and @sundayworldza on Instagram, or like our Facebook Page, Sunday World, by clicking here for the latest breaking news in South Africa. To Subscribe to Sunday World, click here.
Sunday World
