Mango Airlines Sale Moves Forward Amid Legal Disputes in South Africa

Sipho Sono, the appointed business rescue practitioner for Mango Airlines, has declared his intention to finalize the sale of the budget airline, a subsidiary of the state-owned South African Airways, to an undisclosed buyer. This decision emerges from a drawn-out legal confrontation with the South African government, highlighting the complexities of managing distressed assets within the state’s portfolio.

In a recent status update, Sono expressed his readiness to proceed with the 100% sale of Mango Airlines, citing a lapse in response from Public Enterprises Minister Pravin Gordhan. According to Sono, the minister missed a crucial deadline set by the High Court in Pretoria to make a decision on the sale, as mandated by the Public Finance Management Act.

Sono’s move to sell the airline aligns with his interpretation of the Act, suggesting that approval for the sale has been implicitly granted due to the absence of a formal decision by the minister.

The sale process has been marked by intense legal and administrative disputes, particularly between Sono and Gordhan. Gordhan’s hesitance stemmed from a desire to review the business case of the identified preferred bidder, Ubuntu Air Services, a South African consortium announced in early 2023. Sono, however, criticized Gordhan’s delay as jeopardizing the airline’s potential recovery. Mango Airlines has been inoperative since July 2021, exacerbating its financial and operational challenges.

Despite these hurdles, Sono remains optimistic about the airline’s prospects, asserting that the sale could offer a more favorable outcome for both creditors and shareholders than liquidation. This stance underscores a belief in the airline’s potential viability post-rescue process.

The Department of Public Enterprises has yet to respond to Sono’s latest report. Meanwhile, the National Union of Metalworkers of South Africa (Numsa) has urged Gordhan to expedite the sale, criticizing the ongoing delays as a misuse of taxpayer resources.

This development signals a critical juncture for Mango Airlines, as it seeks a path to revival amidst South Africa’s broader aviation sector challenges. The outcome of this sale process will likely have significant implications for the country’s competitive airline market and the strategic management of state-owned enterprises.