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South Africa could offer to sell shares of the bankrupt national airline to the public as part of an ambitious new plan to revive the airline outlined by Finance Minister Tito Mboweni.
The government could bring together the various parts of the South African Airways group into a company that would be co-owned by the state, pension funds, individual investors and an operating partner, Mboweni said in an interview at the Bloomberg Capital Markets Focus virtual event on Tuesday.
That includes the inexpensive Mango arm and SAA Technical maintenance unit, as well as the flagship.
The plan comes as SAA’s fleet of jets sits idle as government and administrators scramble to complete a plan to get the national airline back to the skies.
Mboweni set aside R10.5 billion to fund the operator last month, but has repeatedly voiced opposition to the move and this week questioned whether a private company should not have the opportunity to fill that gap in the market.
“The government has made the decision to support a restructured airline, not the existing one,” Mboweni said. The new airline “would be partly owned by the government and, in general, private sector investors and we should act quickly,” he said.
South Africa has said that several private investors are interested in helping to revive the SAA, and Mboweni said the talks are going well. However, only Ethiopian Airlines Group has expressed a public interest, and only then without providing capital.
SAA’s biggest advocate in government is Public Business Minister Pravin Gordhan, but his plans to create a new airline from the ashes of the troubled airline lack details on how it can be accomplished.
SAA has the potential to be a strong business, but would benefit from having an investment partner in the industry to improve its management, one of the trustees of the bankrupt state airline said Tuesday.
The airline has had nine permanent or acting CEOs over a 10-year period.
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