South Africa Airways’ saviour is in Ethiopia, says study

Bloomberg

South Africa should act to preserve its insolvent national airline and seek to partner the carrier with Ethiopian Airlines Group, according to a study commissioned for ruling-party lawmakers.
The assessment, seen by Bloomberg, was prepared by African Aviation Services and dated October 4. It was presented to a group of African National Congress lawmakers, according to an ANC official who asked not to be identified
because the information isn’t public.
South African Airways (SAA) went into administration in December and now needs more than 10 billion rand ($603 million) to restart, according to a plan produced by the carrier’s business rescuers.
The airline hasn’t made a profit since 2011 and has been surviving on government bailouts.
“There is inherent value in an existing airline which cannot be easily replicated in a new replacement carrier,” Nick Fadugba, the chief executive officer of African Aviation and the author of the study, wrote in the document. “After a thorough analysis, our preferred strategic equity partner for SAA is Ethiopian Airlines.”
Ethiopian Airlines shares a similar “pan-African vision” to SAA and is Africa’s strongest carrier, Fadugba wrote.
Fadugba declined to comment when called by Bloomberg. Department of Public Enterprises spokesman Sam Mkokeli couldn’t immediately comment and ANC spokesman Pule Mabe didn’t answer his phone seeking comment.
“South Africa has the strongest aviation market on the African continent,” Fadugba wrote, citing research that shows that five of the 10 most lucrative routes in Africa are in or from South Africa.