The future of low-cost airline Mango still hangs in the balance. The delivery has now been delayed twice. First by SAA, and now by Public Enterprises Minister Pravin Gordhan.
Mango has been in business for almost two years and in September 2022, it will start looking for a new owner in earnest. By November, the applicant had been identified by a business rescue practitioner, Sipho Sono, and the seemingly arduous process of disposing of Mango began.
SAA was the first spanner at work, delaying the sale process by sending a few more questions to Sono. This was finally answered to the satisfaction of the state-owned operator but, not to the bar set by Gordhan and the Department of Public Enterprises (DPE). The lack of ministerial approval is now holding whatever is left of Mango, potential buyers and Sono to ransom.
Sono said: “This time, it was not SAA because they signed a response and motivated us to approve it, so I believed last month that we were close to a decision. However, as indicated in my report, SAA then wrote to us recently indicating that the DPE did not satisfied with the answers given.Obviously, this came as a surprise as the minister had previously suggested that BRP and SAA should reach a consensus.
SAA sale for Takatso
There has been no real update on the sale of SAA to Takatso – also under Gordhan’s watch.
also read: Low cost airline Mango is looking for a buyer
Aviation commentator and SA Flyer editor Guy Leitch said he believed the go-slow on Mango remained a ploy to protect the deal between Takatso and its existing airline, Lift.
He added that he questioned what the buyer of Mango would buy, since there were no assets, not a single machine, and no route rights to speak of.
Mango’s rights were suspended by the Licensing Board last year, maybe until then it can be used again.
Leitch said: “It’s better for anyone to just start a new airline. Why take on a legacy when you can start your own brand and business, without SAA getting drunk.
Sono said: “Delaying the approval cannot be done indefinitely. I believe that we must get the minister’s decision, by any means.
Gordhan was blamed for Mango’s inertia
Alf Lees, who has been vocal about the DA’s disapproval of the actions of the DPE, and the value and future of SAA and Mango, said: “The failure of Pravin Gordhan to do everything possible to help rescue the Mango business, to sabotage its survival is yet another example of his unsuitability for the charge power of state-owned enterprises or even be in the Cabinet at all.
“Pravin Gordhan is stuck in Marxist control of every aspect of the time warp economy that seems blind to any real form of privatization and thus is the cause of job losses.”
Sono still believes that Pelem can survive. He denied rumors that he had recently heard that the airline had no chance of survival. They also won’t be looking for new investors, despite the current transaction holding pattern.
Sono said: “I am satisfied with the current investors, so I am not entertaining other applicants because without the approval of the minister for the disposal, it does not matter how many other applicants.”
If the decision on the sale of Mango does not go ahead, it could be the end of one of the most successful state-owned companies in South Africa’s history.
Sono said: “The business rescue plan makes provision for wind down, which effectively means that creditors pay dividends from available cash and proceeds from the sale of machinery.
“After that, Mango no longer exists as an airline, but only as a shell. This is the last option I have, especially if there is a reliable buyer who wants to restart Mango and create jobs.
Lees expressed frustration with the sluggish process. He said: “The ANC and the President [Cyril] Ramaphosa has to take responsibility for the disaster at SAA, Mango, SA Express and Eskom and he allowed Pravin Gordhan to finally destroy the place the state held.