CEOs resign all the time – Gigaba

2012-11-13 09:53

The resignation of the chief executive and two senior managers at SA Airways is not a reflection of what is happening in the parastatal, Public Enterprises Minister Malusi Gigaba has said.

“It is regrettable that it happened, but CEOs resign all the time,” he told a business breakfast in Fourways, north of Joburg, today.

CEO Siza Mzimela, corporate affairs general manager Theuns Potgieter, and general manager for legal, risk and compliance Sandra Coetzee, resigned from the airline in October.

This came barely two weeks after most of the board, including chairwoman Cheryl Carolus, also quit, saying there was a lack of support from its shareholder, the public enterprises department.

Gigaba described the resignations as a soccer team leaving the game before the final whistle.

He said SAA officials had asked him to negotiate a financial guarantee with Treasury, which was a lengthy process.

Gigaba explained that his department and Treasury had needed to ask questions, evaluate the financial statements and study the facts presented.

“There were growing concerns raised about the airline... We were not going to simply jump without studying the issue vigorously,” Gigaba said.

He said the relationship between the government and the SAA should not only be a financial one. South Africans were concerned about the airline’s sustainability, Gigaba said.

Speaking about the collapse of low cost airline 1Time, Gigaba said his main concern was with the employees who had lost their jobs.

“I wish this had not been the case ... I don’t think that the reason 1Time has gone under is because of unfair competition,” he said.

“I think that it is because of investment decisions that the company itself undertook ... The more the competition, the better for the customers of all of these airlines.”

He said government did not have the capacity to help all companies in financial difficulties.

Earlier this month, 1Time announced it had applied for business liquidation, and that all of its flights had been grounded.

Comair Ltd chief executive Erik Venter has blamed state-subsidised Mango for 1Time’s demise.

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