Question NW3617 to the Minister of Public Enterprises
23 November 2023 - NW3617
Cachalia, Mr G K to ask the Minister of Public Enterprises
(1)Whether he will furnish Mr G K Y Cachalia with an update on the progress of the deal between Takatso Consortium and SA Airways (SAA) and the projected profit for the 2022-23 financial year, with reference to the R3 billion; if not, why not; if so, what are the relevant details; (2) Whether he has found that no further monies will be allocated by the National Treasury for SAA; if not, what is the position in this regard; if so, what are the relevant details; (3) Whether monies owed to Mango are being utilised in the expansion drive by the SAA; if not, what is the position in this regard; if so, what are the relevant details; (4) On what date will the audited annual financial statements of the SAA be available?
Reply:
1. The progress in the transaction between Takatso Consortium and SAA is as follows:
a) On 25 July 2023, the Competition Tribunal approved the 51% disposal of SAA Government Shares to Takatso with conditions of minority shareholders divesting from Takatso Aviation and SAA not to retrench within 2 years of approval.
B) The subsequent steps are;
- 1. Aviation Regulatory Process: Apply to relevant aviation regulators for licensing approvals;
- Repeal of the SAA Act, 2007: The process has started. The Department is in the process of seeking Cabinet approval for introducing bill in Parliament;
- Fulfilment or Waiver of Conditions Precedent: Prior to the transfer of shares, ensure all conditions precedent are either fulfilled or appropriately waived to maintain the legality and integrity of the transaction;
- Valuation of SAA: New valuation of SAA is being undertaken considering the lapse of time since the last valuation;
- Revision of Transaction Structure: Considering the above valuation exercise, Parties are reviewing the structure of the transaction;
- Transfer of Shares: Execute the legal transfer of shares from current shareholder to new strategic equity partner with all necessary documentation;
- Establishment of New Governance Structures: Set up new governance structures for effective management and decision-making under the Strategic Equity Partner (SEP). This may involve forming a new board of directors and executive leadership; and
- Implementation of Agreed-upon Strategies: Collaborate to develop and implement strategies for the national carrier's growth and development, focusing on areas such as operational efficiency, market expansion, and customer service improvements.
2. The allocation of funds to SAA, similar to other government funding needs has to go through a budgeting process based on Government priorities.
3. The funds of R85 million that was not transferred to Mango, are still with SAA until the Mango business rescue has been concluded. It is not being utilized by SAA for expansion purposes.
4. The audited annual financial statements for SAA for 2018/19 to 2021/22 financial years are currently going through the Board approval processes. They will be tabled in Parliament soon after the Annual General Meeting, scheduled in November 2023.
Remarks: Reply: Approved / Not Approved
Jacky Molisane P J Gordhan, MP
Acting Director-General Minister
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