South African private equity firm Harith General Partners agreed to acquire budget carrier FlySafair as the investor with $3 billion in assets expands its transport portfolio on the continent. <\/p>\n\n\n\n
The deal with the nation\u2019s biggest airline is at an advanced stage and subject to approvals by regulators, including the antitrust authorities and two licensing bodies, Harith Chairman Tshepo Mahloele said. <\/p>\n\n\n\n
The PE firm will purchase the carrier through Harith Aviation, and the transaction should be concluded by the fourth quarter, he said.<\/p>\n\n\n\n
\u201cHarith and its affiliates have entered into a sale and purchase agreement to acquire FlySafair, one of South Africa\u2019s most successful and fastest-growing airlines,\u201d the company said in a statement on Tuesday. <\/p>\n\n\n\n
The acquisition will help FlySafair \u2014 which controls more than 60% of domestic seat capacity \u2014 address regulatory pressure to meet South African ownership rules. <\/p>\n\n\n\n
The Domestic Air Services Council in 2024 said that the carrier was in breach because trusts and companies \u2014 not people \u2014 own 75% of the airline\u2019s voting rights. The ruling followed a complaint by local rival Lift.\u00a0<\/p>\n\n\n\n
\u201cThe deal will make up about 15% of our overall portfolio and will be funded through a mix of equity and debt,\u201d Mahloele said in an interview, without giving financial details. <\/p>\n\n\n\n
\u201cSouth Africa is FlySafair\u2019s stronghold and important to their strategy, and we believe their model can also be competitive regionally.\u201d\u00a0<\/p>\n\n\n\n
FlySafair was given about a year to comply with the requirements or face having its license revoked. <\/p>\n\n\n\n
A deal may assist with the permit issues, although the airline still needs to follow due process, FlySafair Chief Marketing Officer Kirby Gordon said.\u00a0<\/p>\n\n\n\n
Dublin-based ASL Aviation Holdings, which is owned by London-based private equity firm Star Capital Partners, partly controls the South African carrier\u2019s parent company, Safair Operations (Pty) Ltd. <\/p>\n\n\n\n
The transaction will result in a planned reorganisation within the ASL Aviation Group to simplify the shareholding structure and align the ownership of its South African business, Mahloele said. <\/p>\n\n\n\n
Harith will then do a full takeover of Safair Operations, he added.<\/p>\n\n\n\n
Harith was previously also interested in buying a stake in national carrier South African Airways, but the government and the interested acquiring party terminated<\/a> the deal after three years of talks.<\/p>\n\n\n\n \u201cThere were issues on control and pricing in the end and we had to move on, but our ambitions to add an airline onto our transport sector continued,\u201d Mahloele said. <\/p>\n\n\n\n The PE company also considered acquiring a stake in Comair Ltd., the local partner IAG SA\u2019s British Airways, but the South African carrier collapsed in 2022. <\/p>\n\n\n\n \u201cIn the end, the FlySafair opportunity has been the best proposition so far,\u201d Mahloele said. \u201cThere is a great management team and it holds significant market share.\u201d<\/p>\n\n\n\n Harith invests in infrastructure across Africa, and also owns a stake in Lanseria International Airport, northwest of Johannesburg.<\/p>\n\n\n\n For its part, the airline has sought a change in its ownership structure since 2017, reaching a merger agreement with SA Airlink (Pty) Ltd., only for antitrust authorities to prohibit the transaction in 2018. <\/p>\n\n\n\n