Johannesburg | Wednesday
SOUTH African Airways (SAA), in which troubled Swissair holds a 20% stake, said on Tuesday it would be losing “a worthy business partner” after the troubled Swiss company said on Monday that it would dispose of its foreign stakes.
Swissair has filed for bankruptcy protection and grounded its aircraft earlier in the day for lack of cash to buy fuel.
The Pretoria government holds the remaining 80% of SAA, but Swissair had an option — for which it paid four million dollars — to buy a further 10% stake.
Analyst Patrick Bond of the University of the Witwatersrand in Johannesburg said that if Swissair pulled out, the state, which has first option, might buy back its stake cheaply and cancel plans to privatise the airline.
“This represents an opportunity for South Africa to buy back its shares … it makes financial sense,” he said.
Tami Didiza, a representative for Transnet, the government holding company, said it had been in contact with the Swiss company’s management on Tuesday and had been given no indication it would be pulling out of South Africa.
“Until we get official confirmation from Swissair we feel it is just speculation,” he said.
SAA president and chief executive officer Andre Viljoen said: “If Swissair implements its decision (to divest from foreign airlines), it will affect our relationship because the airline not only provides SAA with a commercially viable code share partnership, but as an equity partner”.
“SAA has just recently converted its reservation system to Axres, a computerised booking system, which is managed by Atraxis, a Swissair subsidiary,” Viljoen added.
He said: “The stake that Swissair bought from SAA for $230-million all benefited the South African taxpayer in particular and the South African economy in general, and none was invested into SAA.
“Swissair has been a very good business partner and we will be sorry to see them go,” said his statement, which was headed: “SAA loses a worthy business partner”.
Swissair recently valued its holding in SAA, which last month reported a loss of R735-million ($84.8-million) for 2001, at R845-million and put a goodwill value on the stake of R790-million.
Viljoen said when announcing SAA’s results on September 20 that the airline had “cash of more than two billion rand in the bank”.
He noted, though, that the September 11 terrorist attacks in the United States would set back earnings further.
Swissair, once a symbol of Swiss efficiency and a source of national pride, was already in desperate trouble before the terrorist attacks in the United States which have knocked the world airline industry.
But Swissair says the attacks were the decisive blow which floored it, in the highest-profile, post-attack corporate failure. – AFP