Competition watchdog approves SAA, Takatso deal - but bars minority shareholders, retrenchments
The Competition Tribunal has approved Takatso Aviation's proposed acquisition of a 51% stake in South African Airways, but has given conditions - including a moratorium on retrenchments as, well as a sale of the stake held by minority shareholders.
The Tribunal said in a brief statement that it would issue its reasons for the decision in "due course," with the approval following a recommendation by the Competition Commission in May that the deal be approved with conditions.
One of the conditions sought by the commission – which serves as investigating and enforcement body – is that the minority partners in the consortium, Global Aviation and Syranix, which co-owns LIFT airline, exit. This was sought to avoid decreasing competition in the domestic passenger market.
These minority shareholders have already indicated they are willing to sell, but have expressed regret at the need to do so.
In terms of the Takatso deal, the consortium would obtain 51% of SAA's shares and provide the airline with a capital injection of R3 billion over two years. The Department of Public Enterprises (DPE), as government's shareholder representative, would keep 49%.
Takatso consists of infrastructure investment firm Harith (80%), Global Aviation (10%), and Syranix (10%). The consortium will only take the helm at SAA once the deal is finalised. It has also indicated that it will not take on any of SAA's remaining legacy debt - which stands at about R1.5 billion.
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