Five Southern African airlines have expressed an interest in Air Botswana which is expected to be privatised by September, Botswana’s national carrier said on Monday.
It follows a Botswana government call for formal expressions of interest from potential strategic equity partners. The government hopes to engage a single international airline operator standing alone or as the leader of an investor consortium.
”We have identified five airlines, regional but with international connections,” Air Botswana general manager Willie Makgatlhe said Monday.
”The selection process should be completed by July-August and we expect to sign off the deal by September.”
Makgatlhe said the strategic partner or consortium would be offered a 45% equity stake, while a further 10% would be reserved for airline staff. Government would retain the remaining 45%. Within a year the government would then offer 20% to the public via an initial public offer before the listing the airline on the Botswana Stock Exchange (BSE).
The Botswana government ultimately plans to divest itself through the BSE.
The move would the first ever privatisation of a Botswana parastatal and will kick-off the government’s privatisation programme. The Botswana Telecommunications Corporation is currently restructuring and is expected to be the second entity to be privatised.
Commenting in its weekly investment report, Stockbrokers Botswana said: ”The privatisation of Air Botswana is an important step. The capital raised by the deal will be less significant than the fact that the government is bold enough to undertake the process and thus encourage foreign investment and broader potential ownership of assets in Botswana.”
Air Botswana owns and operates three ATR42-500 turboprop aircraft and one BAe146-100. Its core routes have for six years been feeders to Johannesburg International Airport in South Africa, but it has recently added routes direct from Johannesburg to Botswana’s northern tourist destinations and from Gaborone to Harare in Zimbabwe.
The airline turned its first profit in 1997 and has remained profitable since. Prior to 1997 it had accumulated significant losses before it was restructured which saw it abandon a perceived role as the Southern African Development Community (SADC) airline. In terms of that role it linked the capitals of all member states to the secretariat in Gaborone. ‒ Sapa