SAA ‘could have made a huge profit’

The Citizen (KZN) - - News - Ber­nade e Wicks

The now bank­rupt South African Air­ways (SAA) could have been turn­ing a profit by 2018 if only the state car­rier’s “long-term turn­around strat­egy” had been prop­erly im­ple­mented.

So said for­mer act­ing chief ex­ec­u­tive Nico Bezuiden­hout yes­ter­day in the High Court in Pre­to­ria, where he was the first wit­ness to take the stand in Dudu Myeni’s delin­quent di­rec­tor case.

Myeni served as the chair of SAA’s board from 2012 un­til 2017, dur­ing which time the com­pany is said to have suf­fered losses to­talling al­most R17 bil­lion.

The Or­gan­i­sa­tion Un­do­ing Tax Abuse (Outa) and the SAA Pi­lots As­so­ci­a­tion (Saapa) have taken Myeni to court in or­der to have her de­clared a delin­quent di­rec­tor.

In court, their lawyers have de­scribed Myeni’s time at the helm of the board as hav­ing been “marked by de­cay and fi­nan­cial ruin”.

If the court finds against her, Myeni will be barred from sit­ting on any boards for at least seven years. Outa and Saapa have, how­ever, in­di­cated that they will be ask­ing the court to in­sti­tute a life­long ban in Myeni’s case.

Bezuiden­hout, who worked at SAA dur­ing Myeni’s ten­ure, yes­ter­day laid out for the court the long-term turn­around strat­egy that the air­line had in 2013 come up with, to­gether with the var­i­ous plans that formed part of it.

Ad­vo­cate Carol Stein­berg, who is rep­re­sent­ing Outa and Saapa, yes­ter­day asked Bezuiden­hout: “Is it your in­formed, pro­fes­sional opin­ion that had these plans been fol­lowed, SAA could have in fact been prof­itable by 2018?”

And he was adamant in his re­ply. “One-hun­dred per­cent,” he said. “SAA’s im­proved fi­nan­cial re­sults, dur­ing the time that we im­ple­mented stead­fastly the di­rec­tions as con­tained in these plans, is ev­i­dence”.

Part of the long-term turn­around strat­egy in ques­tion in­cluded an im­per­a­tive that SAA in­crease its net­works through “code-share” re­la­tion­ships.

And one of the al­le­ga­tions lev­elled against Myeni is that she in­ter­fered in one of these code­share re­la­tion­ships and in the process ended up scup­per­ing what would have been a highly lu­cra­tive deal with Emi­rates and seen SAA en­joy an an­nual rev­enue guar­an­tee of $100 mil­lion (about R1.5 bil­lion).

SAA was late last year placed in busi­ness res­cue.

Public En­ter­prises Min­is­ter Pravin Gord­han made the an­nounce­ment that this was a de­ci­sion taken by the board – a short time af­ter a let­ter from Pres­i­dent Cyril Ramaphosa to Cab­i­net – in which he said SAA must en­ter vol­un­tary busi­ness res­cue – was leaked.

This week the state-owned De­vel­op­ment Bank of South­ern Africa an­nounced a R3.5 bil­lion bailout for SAA.

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