A business trading platform based in Cape Town has said it is willing to assist rescue practitioner Sipho Sono of Opis Advisory to market and dispose of state-owned, low-cost airline Mango.
The platform has said it estimates that Mango may be worth about R300 million in total at the top end.
A public representative acting on behalf of the platform has said the company has written to Sono, offering its assistance.
The platform’s CEO, Denny Mo, said: “While the aviation market is not particularly stable presently, it is expected to recover over time.”
He added that Mango’s value lay in the route rights it holds.
The airline is believed to hold rights to Mauritius, amongst other African regional network points, and is presently the only South African airline that can fly between Johannesburg and wildly popular beach holiday destination Zanzibar.
There are likely no other assets of value beyond its potential future revenue and goodwill.
“We have not seen its balance sheet, but based on public reportage, a ‘clean’ Mango that emerges from business rescue, with creditors settled, can be a solid business proposition for investors,” Mo said.
He emphasised that a buyer for Mango, whose fleet is leased, should not be a challenge, and that a strategic equity partner or an outright buyer could be found.
“At an estimated value of R300 million, an investment of R150 million or more, plus a measure of working capital would be required to buy the majority of the business.”
Mo suggested that while the industry was crowded and the airline’s reputation had been muddied after a disastrous 18 months of stop-starting, it had a solid brand and plenty of potential.
“Mango was launched in 2006 and it grew on a sustained basis over time. I believe that a restart with the right investor is possible, and may be profitable.
“We will broker the right buyer to the willing seller.”
Should the platform’s proposition be accepted, it could be their largest transaction yet.
