By Lehlohonolo Lehana.
Public Enterprises Minister Pravin Gordhan announced on Wednesday afternoon that the sale of 51% shares in South African Airways (SAA) to the Takatso Consortium has been cancelled.
This comes almost three years after the consortium was announced as the preferred bidder to acquire the airline for R51.
Gordhan said he had given an update to the Cabinet on Wednesday morning.
“As a result of various factors, we have come to the point where those negotiations (with Takatso) will no longer continue. Our search for the right partner for SAA will not happen through this process,” he said.
SAA is once again fully state-owned, but Gordhan said future operations will not be funded by taxpayers. The airline will look at various other funding options for the expansion of its operations, including expanding its route network.
Gordhan explained that the original deal was done in the aftermath of the Covid-19 pandemic when SAA had just come out of business rescue and was not flying at the time.
At that point the assets of the company were valued at R2 billion – a liquidation value for the property and “not much” for the business.
Since then, the airline has resumed flying and has added routes. Late last year a new valuation was carried out, putting the value of the business at R1 billion and its properties at R5.5 billion.