The business rescue practitioner (BRP) for Mango Airlines (MNO, Johannesburg O.R. Tambo), Sipho Sono, has said he will proceed with the sale of the budget carrier from state-owned South African Airways (SA, Johannesburg O.R. Tambo) to a still-unnamed investor. The move follows a protracted legal battle between Mango’s administrators and the South African government.
In a status report released this week, Sono said he was “pleased to announce that he is now entitled to assume” that he can go ahead with the 100% sale of the low-cost carrier.
The BRP said he would press ahead with selling the airline after public enterprises minister Pravin Gordhan failed to meet a deadline set by the High Court in Pretoria to decide on the proposed sale as required by the Public Finance Management Act.
Sono said he had written to the minister on January 31 telling him he assumed the approval had been granted “by operation of section 54(3) of the Public Finance Management Act” and “accordingly, the BRP will now proceed with the investor process, the effect of which will be the outright sale of Mango to the successful bidder identified by the BRP in August 2022.”
The decision comes after months of legal wrangling between Sono and Gordhan, who had insisted that he wanted to see the business case of the preferred bidder, which was revealed in early 2023 to be South African consortium Ubuntu Air Services, before making a decision on the sale. Sono accused Gordhan of “recalcitrance” and putting the potential rescue of the airline - which suspended flight operations at the end of July 2021 - at risk.
Sono stressed by way of conclusion to his 27th status update report on the matter that he “remains of the opinion that there is a reasonable prospect of rescuing the company, or that the BR Proceedings would result in a better outcome for creditors and the shareholder of the company than would otherwise be achieved should the company be placed in liquidation.”
The Department of Public Enterprises has so far not issued a statement in relation to the report, while the powerful National Union of Metalworkers of South Africa (Numsa) called on Gordhan on February 6 to approve the sale of Mango instead of “wasting taxpayers’ time and money”.