South Africa sued over sale of national airline in $3 deal

South Africa’s government and national airline are being sued by a little-known investment firm, which wants the sale of a majority stake in the carrier scrapped and re-run due to a lack of transparency. This year’s acquisition of 51% of South African Airways by the Takatso Consortium—made up of a local jet-leasing company and a private-equity firm—for just $3 was “unlawful and constitutionally invalid,” according to documents filed at the High Court in Cape Town by Toto Investment Holdings Pty Ltd. The transaction was “shrouded in secrecy” and “not fair, equitable, competitive or cost effective,” according to the filing by Toto founder Bongani Gigaba, who says his firm was unfairly excluded from the deal. “Toto was a direct victim of the unlawful and secretive process.” The filing is the first legal action against the sale, which has drawn criticism from the National Treasury, opposition parties and media in part due to the lack of proceeds for the taxpayer. Yet the airline had been a drain on government finances for a decade, receiving numerous state bailouts before entering bankruptcy proceedings in 2019. After a substantial reorganization that saw staff numbers cut by almost 80%, Public Enterprises Minister Pravin Gordhan initiated a sale process that eventually led to the agreement with Takatso, made up of Global Airways, which owns domestic airline Lift, and private-equity firm Harith General Partners. SAA then resumed flying to nine domestic and international destinations with a fleet of six Airbus jets.<br/>