Papers show how Takatso got nod as top bidder

Certified documents supplied to legislators by the department of public enterprises on Tuesday have lifted the veil on how the Takatso consortium, which has walked away from the deal to buy a majority stake in SAA, was chosen as preferred bidder for the airline.

The department’s internal documents show four bidders were shortlisted as strategic equity partners. A “decision memorandum” penned by the department’s deputy directorgeneral, Jackie Molisane, dated April 7 2021, to the then directorgeneral, Kgathatso Tlhakudi, goes into great detail on how the four bidders fared in the initial evaluation process.

The memo, titled “Update on strategic equity partners (SEPs) process for SAA and advising potential SEPs on the next stage”, advises Tlhakudi to “note the progress with concluding the strategic equity partner process, and sign letters to the SEPs advising on the stage of the process”.

The memo contains the score attained by each of the bidders. The bid by Harith General Partners scored the highest when it came to funding capacity, and joint highest with Global Aviation when it came to overall scoring.

Comments in the memo accompanying the Harith preference said the group “could be an excellent financial partner in a SEP consortium. The funding capacity in one of their funds is available to be deployed. The quantum needs to be confirmed.”

Global Aviation scored highest when it came to operating capacity, with comments that its “operating capability and approach are good”. The ASLBlue Sky consortium scored the lowest, while Air-A scored the second-lowest.

“From the four shortlisted SEPs Global Aviation and Harith General Partners have been shortlisted as they have indicated... significant airline interests... An option that would need to be tested is for Global Aviation and Harith General Partners to combine as the two bidders can complement each other in the airline’s long-term strategy,” the memo reads.

“Once the due diligence has been completed, negotiation of the sale and purchase agreements can commence before a final offer can be presented to the minister to consider and notify the cabinet.”

Tlhakudi wrote to all four bidders on the day he received the memo, informing Harith and Global Aviation that they were progressing to the next stage of the evaluation. He also informed Air-A that its bid had fallen short due to its insistence that the deal include the Airports Company of SA (Acsa). “The DEP has no Acsa mandate regarding the disposal of Acsa...” The ASL-Blue Sky consortium did not meet the funding requirements, according to Tlhakudi’s letter.

The documents submitted to the portfolio committee on public enterprises also show that in July 2020 Tlhakudi sent a letter to the Treasury requesting approval to appoint RMB as SAA transaction adviser without going to tender.

Harith and Global Aviation later teamed up, forming an

entity called Takatso, in a deal announced in February 2022. But the Takatso-SAA deal fell through last week, with public enterprises minister Pravin Gordhan saying that in a postCovid market a new valuation of the national carrier’s worth exceeded Takatso’s original R3bn offer, and negotiations on the new valuation had led to the parties deciding to part ways.

In his letter to parliamentary portfolio committee chair Khaya Magaxa accompanying the documents, Gordhan hit out at the committee for accepting uncritically Tlhakudi’s “untested” allegation that he was sidelined on the deal, and that his opposition to how the deal unfolded had led to his dismissal.

“It is clear from the documents that the Takatso Consortium was not ‘hand-picked’ by me. Takatso was appointed through a process that was led by Mr Tlhakudi himself. The original document was approved by Mr Tlhakudi and is in the department’s possession. A certified copy of this document is attached, which proves Mr Tlhakudi lied to parliament,” Gordhan said in the letter.

“The department is concerned by what appears to be a prima facie case of persecution and personal vendetta. This begs the question of the origin of this behaviour and the question thus becomes what is the motive of its chair, in actively pursuing this direction?”

A day after the documents were given to the committee it called for the Special Investigating Unit to probe the SAATakatso deal.

When contacted for comment, Tlhakudi accused the writer of joining the fight to support Business Day’s owners.