Pretoria-based investment firm Toto Investment Holdings wants to stop selling big stakes in South African Airways (SAA), for R51, to the Takatso Consortium with the support of Harith. The company filed papers in the High Court in Pretoria on Thursday to halt what it considers an opaque market.
Toto founder Bongani Gigaba said his business was unfairly excluded from the market and claimed he was a victim of secret and illegal processes. Despite the Department of Public Enterprise issuing a market statement a few weeks ago, there are doubts and uncertainties about the nature of the agreement.
Putting pen to paper, the consortium will have a 51% majority in SAA, for R51, and will invest in working capital over two years of R3 billion.
According to reports on the filing, Toto alleges that he filed an expression of interest in the SAA, but was quickly rejected.
Public enterprise spokesman Richard Mantu said: “The Department is studying the court papers and will oppose the application.”
The Takatso Consortium also includes Global Aviation, the parent of Lift airline. US editor of Flyer Magazine and aviation commentator Guy Leitch described litigation as “an extremely important development”.
Tax Abusers’ Organization (Outa) chief executive Wayne Duvenage said he was not surprised that someone had decided to legally challenge the market.
“This agreement is shrouded in secrecy and there has been a lack of transparency from the beginning,” Duvenage said.
“If the government does not provide all the information about the financial status of the SAA and how the state came to value it on the airline, the public and other potential investors will continue to question the market.”
Leitch also said that the public enterprise department has their playing cards too close to its chests, and that their refusal to raise transparency raises questions.
“The door is wide open for allegations that the airline will be sold without delay and that the airline could be worth as much as R 10 billion,” he said.
While the government said it would oppose the court action, aviation analyst Phutego Mojapele suggested that South Africans support Toto’s request, which he said he recommends.
“This is a true reflection of the experience of most South Africans. People are tired of the secrecy of government decision-making, especially in the most important place, the public purse, ”he said.
“It looks like someone is finally taking decisive action.”
Pretoria-based firm sues govt over R51 sale of SAA Source link Pretoria-based firm sues govt over R51 sale of SAA