BID­VEST’S “OTHER DEAL” WITH CO­MAIR

Finweek English Edition - - Business strategy - BRUCE WHIT­FIELD

LISTED IN­DUS­TRIAL GROUP Bid­vest is po­si­tion­ing it­self as a lead­ing provider of South African air­port ser­vices as pas­sen­ger and air­craft vol­umes show con­tin­ued signs of strong growth ahead of 2010. Fol­low­ing news last month that Bid­vest has taken a 20% stake in listed do­mes­tic air­line Co­mair, it’s also emerged that the group has bought a con­trol­ling stake in the air­line’s loss-mak­ing ramp han­dling ser­vice, Com­muter Han­dling Ser­vices (CHS).

The ac­qui­si­tion is dis­closed in the Bid­vest an­nual re­port, but not men­tioned in the Co­mair fi­nan­cial state­ments. It’s un­clear what Bid­vest paid for the as­set. CHS, un­til last year a sub­sidiary of Co­mair, has been pro­vid­ing ser­vices to the air­line at cost. The group’s 2006 an­nual re­port dis­closed the di­vi­sion lost R189 422 last year, more than 200% more than the R62 268 loss recorded in 2005.

Bid­vest al­ready pro­vides a range of ser­vices at the coun­try’s big air­ports, in­clud­ing air­craft clean­ing and cargo ser­vices, as well as the up­mar­ket The Pre­mier Club lounges.

Its grow­ing in­ter­est in the air trans­port sec­tor fol­lows its part­ner­ship with In­dian in­fra­struc­ture group GVK and Air­ports Com­pany South Africa (Acsa) to mod­ernise, op­er­ate and man­age Mumbai In­ter­na­tional Air­port.

Bid­vest has pre­vi­ously de­clined to dis­cuss the strate­gic in­ten­tions be­hind its Co­mair deals, but a study of the an­nual re­port re­veals it launched a new di­vi­sion, Bidair Ser­vices, dur­ing 2006. It says in the re­port that it will pro­vide air­craft clean­ing as well as cargo and pas­sen­ger han­dling ser­vices.

It makes no men­tion of in-flight cater­ing, but with just three com­pa­nies – Ger­man-owned LSG, SAA-owned Airchefs and First Cater­ing – pro­vid­ing on-board meal ser­vices to a grow­ing num­ber of air­lines us­ing South Africa’s main air­ports, spec­u­la­tion is rife that Bid­vest, which has ex­ten­sive food-ser­vice in­ter­ests, may also con­sider en­ter­ing that mar­ket.

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