- The Takatso Consortium, the new strategic equity partner for SAA, satisfied a due diligence process, says DPE.
- According to the department, Takatso has the "necessary assets, infrastructure, financial resources and technical and operational expertise" to support the new airline.
- The department assured that no government guarantees would be required and the consortium would provide the required capital.
The Takatso Consortium is capable of supporting a new South African airline because it has the required assets, infrastructure and financial resources, according to the Department of Public Enterprises (DPE).
The department on Friday issued a statement, in response to media queries about the new ownership of SAA.
The government will own 49% of the new South African airline, while the Takatso Consortium - comprised of Global Aviation and Harith General Partners - will have a 51% stake, Fin24 previously reported.
The choice of Harith General Partners as a key partner in the consortium has raised questions.
Last year, the Mpati Commission into impropriety at the Public Investment Corporation (PIC) was scathing in its assessment of Harith's intertwined relationship with the PIC, which paid it hundreds of millions of rands in fees.
Earlier this week, Business Day reported that it was not yet clear how Harith will fund its investment in SAA. The company's existing private equity infrastructure funds are fully committed, and Harith would have to raise new capital for the venture.
But, on Friday, the department said it had conducted a due diligence on the consortium and was satisfied with the outcome.
"After undertaking the due diligence on Takatso, the department is satisfied that the consortium has the necessary assets, infrastructure and financial resources, including the required technical and operational expertise.
"This will ensure that a sustainable, agile and viable South African airline is created," the statement read.
The department also said there would be no need for government guarantees.
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It also indicated the consortium would provide the required capital and there would be no further burden on the fiscus.
The government intended for the airline to be listed in the future, as this would address future funding requirements.
The DPE reiterated that the consortium had "significant operational expertise", which included aircraft acquisition, operations and IT systems, among others.
Other key elements of the partnership include:
- Board seats will follow equity interests of shareholders;
- The management team will take into account the country's national demographics and transformation agenda;
- The government will have a "golden share" of 33% of the entity's voting rights and certain areas of national interest;
- Standard pre-emptive rights will be included for the benefit of both parties; and
- All historical liabilities will be the responsibility of the government within the amount allocated.
The DPE and the consortium will carry out a joint assessment on the future of the subsidiaries, as part of the due diligence process, the statement read.