Report commissioned over staff
trimming, writes Leonard Neill
SPOORNET IS to be split into six different business units with each eventually seeking equity partners in a new bid to get the rail freight and transport division of Transnet back on track financially.
When Spoornet posted R373 million losses for the six months ending in September last year, Zandile Jakavula was brought on board as the new chief executive charged with returning the organisation to profitability.
Now he has announced that Spoornet will be divided into six categories - general freight, mainline passenger services, bulk transport, link rail, Coal Link (the Richards Bay service) and Orex (the Sishen-Saldanha iron ore line).
Each division will be partly privatised or concessioned, says Jakavula, and once profitability has been achieved strategic equity partners will be identified. The primary intention is to make the units self-sufficient with the assistance of international rail specialists.
Jakavula and Spoornet chairman Mafika Mkwanazi are currently abroad talking to industry specialists but have emphasised that companies involved in this process will not be allowed to enter into the equity partnership at a later date as they will have access to
privileged information.
The high-volume iron ore and coal lines provide Spoornet with the major share of its income and are likely to attract partners ahead of the others. Jakavula has however insisted that this will not be allowed until all units have been returned to profitability as the lesser ones would then find themselves without suitable partners.
Fears of retrenchments in the wake of privatisation still exist and Jakavula has announced that merchant bank Rothschilds is currently compiling a report which will tackle the needs of trimming the staff complement.
Findings will be submitted to the Spoornet board by September prior to which no action will be taken in scaling down staff sizes.
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