Sunday, April 21, 2013

■ SOUTH AFRICA: Government planning to merge SAA, Mango, SA Express into one holding company?

SAA logoSouth African Airways (SA) and its subsidiaries, Low Cost Carrier Mango (JE), SA Express (XZ) (and possibly SA Airlink (4Z) though no mention is made of it) could be merged into a single holding company according to a leaked SAA communique.

SAA & Mango in Cape Town, South Africa
SAA & Mango in Cape Town
According to the communique, the South African Department of Public Enterprises, the governmental department responsible for overseeing SAA, is considering the "immediate integration" of all of the state’s aviation assets into a single company, though it is likely that each brand would remain unique and individual.

South African paper, BusinessDay, reports that an incompletely edited copy of Malusi Gigaba’s speech announcing Monwabisi Kalawe as the CEO designate of SAA contained some unredacted text which pertained to the merger:
"The most crucial element of the LTTS (Long Term Turnaround Strategy) is that it requires the immediate integration of the airline group (SAA Group Holdings) where SAA, Mango and SA Express (SAX) operate as part of one holding company structure.

The subsidiaries of the SAA Group Holdings will be consolidated and reported in the consolidated financial statements of the holding company. A new collective Group Vision and Mission will be instilled with subsidiaries strategies aligned to ‘SAA Group Holdings’ strategic objectives. 
A new network, alliance and fleet strategy will be implemented which will align SAA’s Business model to the global aviation market demand. These alignment measures together with other interventions included in the LTTS will transition SAA to improve performance and adapt to the changing global aviation market which will make it commercially sustainab (sic)," the note ends.
Source [BusinessDay]

Asked for comment, Minister Gigaba’s spokesman, Mayihlome Tshwete, said the planned integration was "nothing new" and that the merger had long been under consideration.