Cape Town, 27 March 2001
Late last year, Cabinet agreed that I, as Minister of Transport, should approach Aeroporti Di Roma (ADR) with a view to postponing the launch of the IPO. Together with officials from the Department of Transport, the Department of Public Enterprises, the Chairman of the Airports Company of South Africa (ACSA) Mr. Mashudu Ramano I went to Rome to meet with ADR and we came to certain agreements.
From the side of the South African Government, I therefore announce that together with our Strategic Equity Partner, ADR we have agreed that no IPO will be launched this year.
The original agreement gave Government a right to initiate the IPO by April 2001, failing which ADR would have the right to launch the IPO. ADR has agreed not to exercise this right, and has further agreed with the South African Government to extend the time frame for launching the IPO by a further 3 years. This means that the South African Government will not launch the IPO before 2004.
The reason for this decision is as follows:
1. Not enough has been done to transform ACSA and its management at all airports to reflect the demographics of the South African population. 2. Airports and business activities around airports provide opportunities for Black Economic Empowerment in the form of contracts, procurement, airport-related activities and retail business opportunities. Up to now not enough has been done, though some progress has been recorded. 3. It is necessary for the overall economic growth and development of South Africa that airports countrywide be improved. There is a need for airports to create active synergies between Provincial Government, business, labour and civil society generally to ensure that each provincial airport fully supports the economic and social development of that province.
We have come to the firm view that the immediate launch of the IPO will jeopardise Government's chances of achieving these objectives, which require the use of significant portions of operational profit to enhance development, Black Economic Empowerment and the training of black men and women in all airports-related activities.
We are convinced that we can go a long way in achieving the above objectives over the next 3 years thereby immensely adding value to the company. We also take into account as Government that airports constitute strategic infrastructural assets over which Government should always exercise a degree of control.
ACSA is a highly successful company and has once again registered impressive results. We recognise that the profits derived from ACSA have already been beneficial to the economy as a whole. We wish to ensure that these benefits are fully distributed at provincial level.
We will do everything in our power to promote the objectives stated above, and in doing so, to continue aggressively developing our airports to the highest standards. The benefits for growth in tourism and economic development are self-evident, but need to be aligned. In so doing, major opportunities will open up for the private sector generally and for Black economic Empowerment in particular.
Thank you.
ISSUED BY:
Mike Mabasa
HEAD: Media Liaison and Corporate Communication
MINISTRY OF TRANSPORT