Hanekom’s appointment at SAA still does not address impasse with equity partner

Issued by Ghaleb Cachalia MP and Alf Lees MP –
18 Apr 2023 in News

The DA notes the appointment of Derek Hanekom as the interim Chairperson of South African Airways (SAA), including other interim executive appointments, but we remain skeptical that he will be able to address the existing impasse with SAA’s equity partner, Takatso Consortium, without asking the South African taxpayers for billions of rand more in bailouts.

When the Takatso deal was first announced by the government in June 2021, Takatso made an undertaking to invest R3bn in SAA over 3 years. Almost two years have elapsed but the promised equity injection by Takatso is yet to materialize. It’s as if Takatso wants the taxpayer to foot all the recapitalization costs of SAA and they just reap the benefits through their 51% stake.

Changing board appointments frequently does not address the elephant in the room – namely; at what point will Takatso fulfill its end of the business agreement and start fulfilling its responsibilities as the largest equity partner in SAA? The whole purpose of the state ceding a majority stake in SAA was so that the fiscus is freed from the constant requests for bailouts which had become frequent and unsustainable. Two years later, it appears Takatso still wants to keep the bailout taps open.

While Mr Hanekom, a former Minister of Tourism, has been characterized by the Minister of Public Enterprises, Pravin Gordhan, as having a deep understanding of the aviation industry’s crucial role in promoting travel and economic growth, he knows next to nothing about the aviation industry and his appointment is yet another example of the ANC’s cadre deployment. One would have expected Gordhan to consider appointing someone with aviation expertise to oversee SAA’s transition period and implementation of the public/private partnership with the Takatso consortium.

SAA is playing in an increasingly competitive environment and the longer it takes to get the Takatso deal going, while busy changing the deck chairs, will increase the chances of failure and more bailouts from a fiscus that is already stretched to the limit.