Cape Town - President Cyril Ramaphosa has blamed confidentiality for the government’s failure to disclose the details of the deal to sell South African Airways shares to Takatso Consortium.
He told the National Assembly on Thursday that efforts had been made to reposition SAA up to the point where the government stopped total collapse and destruction of the entity by bringing in a strategic equity partner (SEP).
The SAA deal has been marked by secrecy, with both Ramaphosa and Public Enterprises Minister Pravin Gordhan refusing to disclose the finer details of the deal to the public, including other bidders.
“The SEP is going to really reposition SAA, and the government will be a shareholder at 49%, but we will have the golden share and the brand name will continue.
“We hope that SAA will be repositioned completely. It is already showing signs of that because it is rather trading well at the moment,” he said.
However, IFP MP and Scopa chairperson Mkhuleko Hlengwa asked what the basis was for selling the stake in the national airline when it had not produced audited financial statements for four years.
“How much was the 51% stake sold for? You ascended to office, (and) the refrain was transparency. The fact that the SAA-Takatso deal has been behind a veil of secrecy does not inspire any confidence, (and) nor does it bode well for certainty insofar as future travel is concerned,” Hlengwa said.
He asked when the government would be wholly transparent about the matter.
In his response, Ramaphosa would only say Hlengwa’s quest for transparency was understandable.
He noted that the SAA-Takatso deal had been before court and the Competition Commission.
Ramaphosa said they needed to outline fully what the terms of the transaction had been.
The Cabinet received an update on the deal at its Wednesday meeting. Ramaphosa said SAA was totally and completely bankrupt.
“Those are the same facts that we need to put on the table so that everyone does get to understand without this transaction.I can say without any equivocation that SAA will go into liquidation,” he said.
The president said SAA's liabilities far exceeded its assets.
“Yes, that needs to be shared, so that we get the full understanding, because there is a notion that this deal is struck in total secrecy and there are a lot of funny things that are happening. People need to be alive to the fact that we are dealing with a company that was totally bankrupt (and) in a messy situation.
“For a company like that not to be able to produce financial statements for a period of four years, you would know better as chair of our Scopa that it means there was just chaos. That chaos translated itself into its commercial viability, into finances, and unfortunately we reached a stage where we kept bankrolling SAA on an ongoing basis. That now will come to an end when this transaction is finalised.”
Ramaphosa said he agreed with Hlengwa that the quest for transparency was a fair one.
“It so happens that with transactions of this nature, which are done commercially between company and company, there is always a confidentiality clause and all of that. But we need to address it politically and say what does it mean to the actual shareholders, who are the people of South Africa,” he added.
Cape Times