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Public Enterprises department reports unsolicited investor interest in SAA


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Public Enterprises department reports unsolicited investor interest in SAA

Public Enterprises department reports unsolicited investor interest in SAA

24th August 2020

By: Rebecca Campbell
Creamer Media Senior Deputy Editor


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The Department of Public Enterprises (DPE) reported on Monday that the South African government had, by the start of this month, received more than ten unsolicited offers of interest in South African Airways (SAA) and its subsidiaries. SAA is the State-owned national flag carrier, and its subsidiaries are airliner caterer Air Chefs, maintenance, repair and overhaul company SAA Technical and low cost carrier Mango.

Financially-embattled, SAA was placed in business rescue in December last year. It is now at the beginning of a relaunch process following the approval of its business rescue plan. 


“The DPE welcomes the attraction of a mix of local and international investor groups to provide the new airline with technical, financial, and operational expertise to ensure significant South African ownership whilst diversifying the investor base,” affirmed the department in its statement. “As the sole shareholder on behalf of the government, the DPE had been busy assessing the interests from the several unsolicited local and international Strategic Equity Partners (SEPs) as part of the implementation of the business rescue plan, which was published at the end of June 2020.”

The DPE further affirmed its belief that these outside investments in the new SAA would underpin key areas of the South African economy, including tourism. They would also strengthen the country’s position as an African gateway to intercontinental markets. “Such partnerships will also improve scale and scope and ensure continuity of value creation to the South African economy and long-term sustainability of the aviation industry managed by competent, competitive and skilled personnel who possess strategic and technical capabilities, which are critical to the success of the new carrier,” stated the DPE. 


Regarding the new airline, the department reiterated its several desires about the nature of the new SAA. It stated that the government would maintain “a certain level of presence in the ownership of the new carrier”. Then it added that the new fleet should be composed of cost-efficient modern aircraft, providing “hybrid density options”. The airline should also offer the “right” routes and services with tariffs that were competitive.

Further, it should have a “network structure that allows for connectivity at hubs, whilst maintaining elevated aircraft utilisation”, linking “Africa to world economic hubs whilst maintaining diplomatic connectivity”. The workforce should be “right-sized and motivated”. The new operation should be “customer-centric … lean, technology savvy, digitally native and agile to service all market segments”.



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