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SA airlines already working together amid merger talks — Gordhan

Minister of Public Enterprises Pravin Gordhan told eNCA on Sunday evening that discussions regarding the merger of three government airlines would continue this week with other relevant ministers.

South Africa has been abuzz with the potential consequences of merging Mango Airlines with SA Express and South African Airways. The airlines have each been pulled back from abysmal management in the past decade, as the case for owning a national airline comes under scrutiny.

READ MORE: Merger of SAA, Mango and SA Express firmly on the table

Gordhan told eNCA analyst and host Karima Brown that he would be having meaningful discussions with relevant colleagues in Cabinet on how to go about merging the airlines. He said these discussions would commence within the next few days.

“That is a discussion I am starting this week with departments like Treasury. We need to look at the evaluations already done by consulting firms almost eighteen months ago. We must ask which areas we can rationalise, use one another’s resources,” said Gordhan.

Gordhan told eNCA that the airlines have already been cooperating to ensure services and operations continue despite the many difficulties the airlines have experienced.

“Long before we started the discussion, this has been in action. SA Express is grounded and SAA management has really come to the party to take on passengers and take on other flights and put on certain flights that they would not traditionally do. That is a great example of working together,” he said.

READ MORE: SA Express suspends operations over ‘serious safety risks’ from today

Gordhan did not shy away from the staff headcount being a consideration that warranted serious discussion in the process. This comes as Sunday Times reported on Sunday that a music promoter facilitated an SA Express fuel supply deal of R2.4-billion without a drop of fuel being provided.

“The value propositions and cost structure is changing all of the time. There are areas where we can save costs. Staffing is obviously one of those costs. But we have to sit with our partners and have a discussion on what it is we have to do,” he said.

Gordhan said all ministers deployed by the ANC government were aware of the deployment system which put them in Cabinet, but said the “membership card in your back pocket” should not influence the decisions which relate to management of these beleaguered entities. — Fin24

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Khulekani Magubane
Khulekani Magubane

Khulekani Magubane is a senior financial reporter for Fin24. 

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