SAA is in the headlines again,
with talk about more bail-outs.
Minister of Public
Enterprises, Lynne Brown, said
during a recent government
briefing, that the government
was still looking at a model
that would see the three
airlines in the Department of
Public Enterprises portfolio –
SAA, SA Express and Mango
– collapsed into one.
SAA announced in
September last year that by
early 2014 the three airlines
were to be integrated into
a new group that in turn
would form part of a new
holding company reporting
to the Department of Public
Enterprises (DPE). But despite
the announcement last year,
the three airlines currently still
each have their own board with
their own structures, strategies
and CFOs.
Lynne said: “I want to look
at a model with one board, cut
high overheads and make sure
the integrated airline is leaner
and meaner.
“It’s critical that we have SAA
under control.”
SAA will not be privatised,
despite the fact that it
continues to be unprofitable
and will possibly need a
capital injection to turn around.
The Minister said: “It’s not
government policy to privatise.
Across the world, and in
particular New Zealand and
Australia, are examples of
airlines that were privatised
and today they are back as
state-owned companies.”
Meanwhile, SAA has,
according to various other
publications, reportedly hired
KPMG to advise on its fleet
renewal programme, which
includes the acquisition of
25 new wide-body aircraft
to replace the ageing
Airbus NV A340s.
SAA ceo, Monwabisi Kalawe,
said in an interview with
Bloomberg in Washington, that
SAA needed ‘billions’ of rand
from the government to be
sustainable. He was quoted
as saying the airline had
agreed with the Department
of Public Enterprises and the
Treasury on a figure for the
capital injection for the airline.
“They’ve agreed a number
and that number is currently
being discussed and debated
by our political principals. It
was projected that somewhere
between financial year 2016
and 2017 the airline would
break even.”
The DPE remained
tightlipped on the figure
for SAA’s capital injection.
Spokesperson for the DPE,
Colin Cruywagen, told TNW
that recent newspaper
reports claiming Minister
Browne had announced that
SAA would require private
funding of R50bn in the
form of loans backed by the
Treasury were false.
Despite numerous attempts,
SAA did not respond to
requests for comment at time
of going to print.
