Solidarteit Wêreld
2013 - Uitgawe 1 Bedryfsnuus
Jetworx transaction approved while 1time’s future hangs in the balance
Deur Len | 19 Februarie 2013

While the sale of Jetworx ensured a further six months’ employment for the company’s approximately 200 employees, the future of 1time’s nearly 540 former employees still hangs in the balance, writes NICO STRYDOM.

 

Marius Croucamp, spokesperson of Solidarity, said that 79% of the creditors of Jetworx, a former industry affiliate and maintenance wing of 1time Holdings, were in favour of selling the company to an affiliate of the American Industrial Acquisition Corporation (AIAC).

“We hope that Jetworx will now receive more business, be able to retain its employees after this period, and that no further retrenchments or restructuring will take place at the company.”

Before Jetworx commenced with its business rescue plan in August 2012, it had already retrenched about 200 of its nearly 400 employees. No more lay-offs were then enforced, but after 1time was placed under preliminary liquidation, Jetworx was obliged to consider further retrenchments.

The future of 1time’s previous employees, however, still hangs in the balance. At the time of going to press, no decision had been made about whether 1time could be sold to FastJet. Croucamp said that 1time had submitted an application to the Air Services Licensing Council (ASLC) to be exempted from subsection 16(4)(c)(ii) of the Air Services Licensing Act of 1990 so that FastJet could become the majority shareholder of 1time. Last year, FastJet signed an option agreement to buy 1time Airline after it was placed under preliminary liquidation. 1time submitted an application to the ASLC, a division of the department of transport, to include FastJet in its shareholding. ‘In terms of legislation introduced by the previous government, the shareholding of a local airway must be structured in such a way that South African residents retain 75% of the voting rights.

However, it seems that FastJet wants a majority share in the company and this could result in the failure of the transaction, which would in turn mean that there is no further hope for the nearly 540 people who lost their jobs when 1time closed its doors. 1time submitted an application asking not to be subject to this specific condition of the legislation. The minister of transport can, by law, instruct the ASLC to make an exception and award a licence even if the airway’s shareholders are not South African residents.’

Croucamp said Solidarity is concerned that the minister may decide against such a concession, which would put a spoke in the wheels of the transaction, since government’s behaviour in the airline industry has thus far been marked by strong opposition against competition. ‘Strict legislation and the state’s monopolistic behaviour in the airway industry, which includes the state’s continued financial support to South African Airways (SAA), force free-market competitors out of the market. The demise of SAA’s competitors also serves as a strong deterrent to potential investors who had perhaps still considered entering the aviation industry.’

According to Croucamp, a decision by the minister not to grant the concession will send a clear message that government intends to protect SAA at all costs and that there is no place for other airlines in the South African aviation industry.

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Redakteursbrief

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