The lesson learned by Fly SAX is that not all eggs are in one basket.
Gallo Images / Grant Duncan-Smith
- Harris, an investment fund, is a key member of the consortium and may eventually acquire a majority stake in SAA.
- However, I used to think that it was part of the transaction to buy SA Express.
- A former potential partner in the deal described Harris as “backtracking” and described the decision as “amazing.”
Infrastructure investment firm Harris General Partners, which is part of a consortium that may acquire a majority stake in SAA, is considering becoming part of a contract to purchase the state-owned regional airline SA Express (SAX). But then abandoned it. bid.
In doing so, SAX could potentially face liquidation.
FlySAX, SAX’s preferred bidder, said he was “surprised” that Harris considers it a “backtrack” in his “significant commitment letter.”
In a January 22 lawyer’s letter from Fin24, G Nkomo Attorneys signed a contract with SAX’s interim liquidator, Siga Express, a strategic investment group represented by Patuxolo Nodada, and Harris General Partners, represented by Tshepo Mahloele. Is written. As an “anchor investor,” SAX gives a “firm commitment” to provide a guarantee for the payment of SAExpress’s purchase price of R $ 26 million. The letter states that Shiga and Harris’ business as anchor investors will expire on June 30, 2021.
The state-owned regional airline SAX was tentatively liquidated in April 2020 after the business rescue process failed.
Fly SAX – a group of former SAX employees – was accepted as a priority bidder for SA Express last year. In May of this year, after an airline interim liquidator discovered that Fly SAX violated the terms of the sales process as “no funds”, it submitted a revised proposal to the airline interim liquidator. ..
A week ago, Harris was announced as a key stakeholder in the Takatso Consortium, which includes the aviation group Global Airways, which holds a substantial 51% stake in SAA. The rest will be borne by the government. This transaction will continue to be subject to due diligence proceedings.
For SAA, strategic equity partnerships are essential not only to secure funding for takeoff again, but also to prevent the government from having to take more bailouts in the future.
Harris confirmed to Fin24 on Friday that he was “approaching this opportunity” [with Fly SAX]However, after a thorough evaluation, I decided not to pursue it. “
No contract has been signed
Fly SAX representative Thabsile Sikakane told Fin24 on Friday that Fly SAX was originally approached by Siga, showing interest in participating in SA Express transactions. According to Shikakane, Shiga then involved Harris.
“The lesson learned by FlySAX is not to put all the eggs in one basket, but sometimes to trust them too much,” says Sikakane.
Nothing has been “directly” signed with Harris, Shikakane said, but a lawyer’s letter from January indicated that Shiga and Harris intended to commit to the deal.
“We haven’t heard anything since January of this year. We were asking for a meeting, and suddenly when we thought we were on FlySAX for SA Express, Harris signed a SAA deal. I heard you’re involved, “said Sikakane. ..
“It’s amazing that they went back just to get out with our sister airlines.”
Sikakane said Fly SAX would like to see if it could regain its ability to provide the right funding by acquiring another anchor investor or pursuing crowdfunding.
Now that Harris is out, G Nkomo has replied on behalf of Nodada that the SA Express deal is still underway and Siga Express “must act until June 30, 2021.”
“However, as of March 9, 2021, Harris General Partners will no longer participate in this transaction, so Siga Express will endeavor to act in accordance with the June 30, 2021 deadline.”
“If the interim liquidator seeks to hold FlySAX responsible for non-repudiation of the first binding offer, it cannot and will not accept this backtrack by Harris General Partners,” FlySAX said. Said in a statement.
“Flysax has fought very hard to save this airline. What happened to us is very painful. Emptying SA Express again for an” opportunistic businessman ” You should not deny the opportunity to take you. ”
In January of this year, a court ruling postponed the date to determine whether SAX needs to be liquidated to April 29, and then again to July 28, this year. The purpose was to provide more time trying to save the airline.
In addition, SA’s National Metalworkers’ Union (Numsa) and SA Cabin Crew Association (Sacca) have called on the Constitutional Court to try to force parliament to discuss whether SAX should be allowed to go bankrupt. I submitted my application. Both unions argue that the court cannot finally liquidate a state-owned enterprise without parliamentary oversight.
Sacca’s president, Zazi Nsibanoni Mugambi, told Finn 24 on Friday that Harris “must do the right thing and respect his commitment to Eastafrican.”
“It’s shocking that this happens to them, and as a sucker we believe it shouldn’t be accepted. They are still waiting to receive the money they have to pay and the funding needed for this SA. Express Bid is working very hard on non-existent resources to procure. Harris General Partners seems to have dumped this deal for a more lucrative deal. “
“If this is the case and people at SA Express are fooled, they will be given a second opportunity to submit another bid to another investor so that Harris’ actions do not penalize him. I need it. It’s their fault. “
“Amazing”-How Harris, one of SAA’s new partners, abandoned previous airline bids
Source link “Amazing”-How Harris, one of SAA’s new partners, abandoned previous airline bids