South Africa has terminated a deal to sell a majority stake in its national airline, South African Airways (SAA), to a private consortium. The government had sought to sell 51% of SAA to the Takatso Consortium since 2021, aiming to end the cycle of bailouts for the struggling carrier. However, after three years of negotiations, the deal has been called off due to the inability to agree on terms and value, with Public Enterprises Minister Pravin Gordhan citing the post-Covid-19 market impact as a significant factor.
Minister Gordhan mentioned that SAA could sustain itself in the near future without the need for immediate privatization, indicating a reevaluation of the airline’s financial position. The Takatso Consortium expressed that the changes required in the deal would have taken too long to achieve, leading to the collapse of the agreement.
As a result, SAA will remain fully state-owned for the time being, although the government remains open to exploring other partnerships for the airline. The failure of the deal represents a setback for President Cyril Ramaphosa’s efforts to privatize non-performing state entities and manage state debt effectively.
Source: BBC NEWS