Mango's Fate Hangs in the Balance: Minister Given 30 Days to Decide on Sale

Minister of Public Enterprises Pravin Gordhan has been granted a 30-day ultimatum to make a pivotal decision regarding the sale of Mango, the state-owned low-cost airline that has remained grounded since July 2021. Business rescue practitioners overseeing Mango’s affairs have identified a potential buyer, yet their plan hinges on Gordhan’s approval.

The North Gauteng High Court in Pretoria recently issued an imperative directive to Minister Pravin Gordhan, demanding that he reach a verdict within 30 days regarding the undisclosed bidder’s proposal to acquire Mango. In the event of Gordhan’s failure to make a decision within this timeframe, the court has ruled that the business rescue practitioners will be authorized to proceed with the sale.

Mango, which operates as a wholly-owned subsidiary of South African Airways (SAA), has languished on the tarmac for over two years, with its financial woes prompting the necessity of a buyer to salvage its future.

The minister was initially asked to endorse the sale back in September of the previous year. However, by the time the case was argued in May, Gordhan had not provided a definitive response. He expressed the need for additional details about the prospective buyer, including their business plan and any foreign ownership considerations. This stance was met with resistance from Mango’s business rescue practitioner, Sipho Sono, who argued that the sale would create a competitive conflict between SAA and Mango.

Nonetheless, Gordhan was furnished with an executive summary of the potential buyer’s business plan. Subsequently, in February, Sono approached the high court to compel Gordhan to make a final decision. The National Union of Metalworkers of South Africa also joined the chorus in advocating for the sale’s approval.

This week, the court unequivocally declared that the minister’s prolonged indecision amounted to “unreasonable delay.” The court emphasized its duty to ensure that constitutional obligations vested upon the public enterprises minister were met. Gordhan’s failure to reach a verdict was deemed “unlawful and constitutionally invalid.”

The identity of the company poised to acquire Mango from its parent company, SAA, remains closely guarded. The ruling offered little insight, with the business rescue practitioners merely disclosing that the owners of the “investment company” were South African entities. The prospective investor has committed to acquiring Mango’s shares from SAA and clearing all outstanding debts owed to creditors.

In conclusion, the clock is ticking, and Minister Pravin Gordhan must soon make a crucial decision that will determine the fate of Mango, the grounded low-cost airline. The court’s ruling underscores the urgency of this matter and emphasizes the need for the minister to act in accordance with his constitutional duties.