The Department of Public Enterprises came under fire on Monday for being secretive and not informing the market of its plans to replace the South African Airways (SAA) board of directors.
This comes after the National Union of Metalworkers of South Africa (Numsa) forced the DPE's hand to reveal the new interim board, after the labour union said in a statement it had been reliably informed, that Minister of Public Enterprises Pravin Gordhan had removed the SAA board, replacing it with an entirely new board, and had done so without informing the public, or informing the governing party.
"We are told that the entire SAA board was removed as of the 14th of April and replaced with new board members who have already received their appointment letters. Numsa has information from a credible source, who shall remain anonymous, that Gordhan has sworn the entire board to secrecy in order to protect his alleged corruption," the union said.
After media calls for answers, the DPE released a statement on Monday evening and said Gordhan had appointed a new interim board of directors for SAA.
Derek Hanekom has been appointed as interim non-executive director and chairperson of SAA. Fathima Gany, Fundi Sithebe, Mahlubi Mazwa, advocate Johannes Weapon, John Lamola, Clarissa Appana and Dumisani Sangweni were appointed as interim non-executive directors.
The interim board was effective from April 15, 2023, and would serve until the introduction of the strategic equity partner, Takatso Consortium.
The consortium is poised to acquire a 51% majority stake in SAA, with the transaction presently undergoing regulatory review.
The DPE said this move marked a significant step forward in the national carrier's ongoing transformation.
"This new interim board builds upon the foundations laid by the previous board and brings together an exceptional team of experts with experience across various fields," the department said.
Gordhan said: "The appointment of this interim board underscores our unwavering commitment to the success and stability of South African Airways.
"Their exceptional experience and expertise will guide the airline toward a prosperous future in collaboration with the Takatso Consortium. We recognize the challenges SAA has faced in the past and the importance of learning from those experiences to ensure the airline's future success," he said.
Gordhan said the government was resolute in demonstrating its dedication to restructuring SAA and revitalising state-owned enterprises, as part of its broader commitment to promoting economic growth and development.
"To support SAA in achieving its goals, we have put in place strategies and plans that align with the airline's vision and objectives," he said.
Meanwhile, the Tourism Business Council of South Africa (TBCSA) said it has noted and welcomes the new board appointments at SAA.
"This includes the appointment of former tourism minister and tourism investment envoy, Mr Derek Hanekom as chairman of the board. Hanekom has previously displayed an impeccable record of clean governance and a passion for tourism in South Africa," it said.
TBCSA board chairman Blacky Komani said: "Travel and tourism are enabled in large part by aviation. As a sector, we hope to attract 21 million arrivals in South Africa by 2030. To achieve that, we need connectivity. The more stable airlines we have operating in the country, the quicker we’ll realise our tourism sector recovery plan of attracting these travellers”.
TBCSA said SAA played a significant role in South Africa’s aviation and tourism sectors. Therefore, it filled them with hope that the addition of new members to the board would solidify the work of improving operations and relaunching regional and long-haul routes.
"A fully-functional SAA benefits the country’s tourism sector locally and internationally. It is through airlines that visitors to the country first experience our hospitality. The national carrier’s full recovery will help to address some of the under-supply challenges we have seen in the local airline space over the last two years," it said.
Meanwhile, Numsa said that as things stand, SAA had been totally undervalued for the sake of enabling corruption.
"The last SAA audited report ending March 2017 says that SAA’s total assets were valued at R14.5 billion. Government has paid off all the debts of SAA, but it is apparently valued at R3bn. What happened to all of SAA’s assets? Either these assets were disposed of by the business rescue practitioner, or by Pravin Gordhan himself. What is disturbing is that we are told that the Takatso Consortium appointed its own valuator, who valued the assets of the airline at R3bn.
"It is highly irregular that an entity like Takatso, an outsider, which is undergoing a process to be an equity partner at SAA, has a valuation which is so much lower than what SAA was valued as of 2017 audited financial statements. Is this why SAA is being sold for R51, as reported in media reports? Are we really dealing with a rogue minister who sold a state entity to his friends so they can loot the airline for their selfish benefit? These are some of the questions we are asking," it said.
BUSINESS REPORT