FlySafair alters ownership, awaits licence

Published Nov 28, 2013

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Johannesburg - FlySafair, the new scheduled airline started by long-established charter airline Safair, is now owned by a majority of South African residents and is preparing to start flying between Johannesburg and Cape Town with fares below those now being charged on the route.

But because there has been a change of ownership since its operating licence was granted, it has had to submit an application for a new licence. This may not be granted in time for FlySafair to launch its services before the Christmas holiday rush.

An injunction preventing it from starting up earlier was successfully obtained in the Gauteng high court by domestic and regional airline Comair and Skywise, a new airline preparing to fly the route, on the grounds that the controlling shareholders were Irish. This meant it did not comply with a regulation that a South African domestic airline must be 75 percent South African owned.

Safair has now set up a broad-based BEE transaction, Ndiiza Safair Employee Trust, which chief executive Dave Andrew said was the largest aviation employee share scheme in South Africa. He said this meant FlySafair now met the condition that 75 percent of the owners of a South African airline were South Africans resident in this country, and they all had equal voting rights.

Andrew said the South African Air Licensing Council was aware that Safair was in the process of launching this scheme when the operating licence, which would have enabled FlySafair to start a few weeks ago, was granted.

Previously, one of the three South African directors – who had fewer voting rights than Irish company ASL Aviation but who were named as the controlling shareholders of FlySafair – was Hugh Flynn. He was born and brought up in South Africa but has dual Irish and South African nationality and lives in Ireland. His shares have now been transferred to the employee share trust.

Air fares on the Johannesburg to Cape Town route have rocketed since low-cost airline 1Time went out of business in December. The route is flown by Comair and SAA and their low-cost divisions, kulula.com and Mango.

When plans for the launch of FlySafair were announced, Andrew said it would charge lower fares than those currently being paid. He said yesterday that it would be launched as soon as possible but would now have to reapply for an operating licence.

Skywise, which the original founders of 1Time planned to launch in time for Christmas, has waited for months for an operating licence. - Business Report

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