Comair to retire Kulula MD82's
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One of the nice things about reading things on PPrune is the amount of rubbish spoken!
I think by and large we've debated it in a measured way.....people of French extraction often have some strange ideas
Are you intimating that because of the BEE deal that BA plc might want to have a greater investment in Comair? If they do and I was a Comair investor I would be a bit worried as BA's record in regional ops in the UK is woeful. I'm not slagging BA - just pointing out that their history in this area is less than illustrious, see BRAL, BA Citi-express etc. The fact that Comair is locally owned and run is in my view part of why they've been so successful.
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Originally Posted by Goldfish Jack
One of the nice things about reading things on PPrune is the amount of rubbish spoken!
A business that has been profitable for 50 years and needs to expand can do it several ways - by raising capital on the equity market or by selling part of its shares as well. It is well known that Comair is a sought-after business and they are ideal for a takeover, to enable them to expand. Sure they have sold a lot of equities, but the whole deal has been financed by a well known investment bank is SA. Sure it is going to be a BEE-related company and the deal will officially be announced shortly, but have any of you thought of this:
BA plc, as an overseas investor, owns 18% of Comair and in terms of present legislation, this is the maximum allowed to be owned by a foreign company, if no there is no BEE element. Should there be a BEE element, that ration can be increased to 40%. mmmm
A business that has been profitable for 50 years and needs to expand can do it several ways - by raising capital on the equity market or by selling part of its shares as well. It is well known that Comair is a sought-after business and they are ideal for a takeover, to enable them to expand. Sure they have sold a lot of equities, but the whole deal has been financed by a well known investment bank is SA. Sure it is going to be a BEE-related company and the deal will officially be announced shortly, but have any of you thought of this:
BA plc, as an overseas investor, owns 18% of Comair and in terms of present legislation, this is the maximum allowed to be owned by a foreign company, if no there is no BEE element. Should there be a BEE element, that ration can be increased to 40%. mmmm
What needs to be understood here is that just because Comair has been around for years doesn’t mean it doesn’t make mistakes. Is that a bad thing-no!! the issue was why not be open about who the shares goes to- in fact when Gideon Novick was on 702 recently he was asked about the trade- he ducked the question completely, as if he didn’t know about it- that type of thing is always going to raise a few eyebrows- the media got hold of this too. I think Comair are afraid of the way the market are going to take this BEE deal and have decided to play this one close to their chests.
In terms of other observations made, perhaps some don’t agree but I believe Comair are painting themselves into a corner with running the 2 brands and are going to have to make some decisions rather sooner than later in terms of what market segment they will choose to dominate or it will harm the airline as a whole, all the while uncle vern is sneaking up behind you
On a a totally unrelated point, did you know that SA Express told Equity that if they continue to handle 1Time, they would cease all their handling contracts with Equity. WHo is smoking what at SA Express - who do they think will do their handling around SA - Swissport ? opposition to Equity and SAA??
SAX have even more choice than you think- it is well known that SAA are going to take 50% of their contract away from Equity once the current contract expires- its going to be very convenient for SAA to see how another handling agent handles SAX and will definitely help it in its decision when the time comes (SAA staff handle SAX check-in at the main airports so SAA staff will get a feeling very quickly for how things are running) This is not going to be lost on the other 2 bidders for the SAX business. Im sure you are well aware that CHS has got aspirations for greater things, again this has been communicated to SAA...
If SAX kick equity out then they will have no option but to charge 1Time more for handling because at some stations they will be their only customer – eg BFN the economy of scale that prevailed due to SAX kindly paying the bills as the anchor client will evaporate- smart business if you ask me
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Kulula and BA/Comair are one and the same company!
