The administrator of Mango Airlines is planning legal action against the Minister of Public Enterprises, Pravin Gordhan, to compel him to decide on the application to sell the airline. South African Airways (SAA), Mango Airline’s parent company, has wanted to sell the airlines for over two years now, with little success.
After entering voluntary business rescue in July 2021, Sipho Sono, a senior Business Rescue Practitioner (BRP), was appointed as Mango's provisional liquidator to find investors. In 2021, SAA applied to the Minister of Public Enterprises, Pravin Gordhan, to sell the budget carrier. Due to unresolved queries and deadline extensions, Gordhan had the deadline of January 31, 2022 to respond.
In a letter sent last month to Gordhan, Sono clarified that the airline had given the minister enough time to decide on the application. Going ahead he said that the minister’s delay in decision making would jeopardise the sale of Mango airline as the preferred bidder would withdraw from the transaction if a decision was not made by February 28, 2022.
The Minister of Public Enterprises responded to the letter by saying that he would not decide on the application until South African Airways provides him with certain undisclosed information he asked for. He added that the BRP had no authority to address correspondence directly to him with respect to the application.
Now, the future of Mango Airlines depends on the minister’s approval. After the response to his letter, Sono was left with very few alternatives: wait for the minister’s decision, approach the courts for relief, or institute the wind-down process.
After taking legal advice, Sono has resolved to institute urgent legal proceedings against the minister to urge him to make a decision on the application.
Meanwhile, on February 5, 2023, Sono received notice from South Africa's International Air Services Council (IASC) that Mango's air service licence had been cancelled with immediate effect on February 3, 2023, because no decision was forthcoming on the proposed rescue of the airline. Sono demanded clarity from the IASC, especially as it was aware of the impending legal proceedings. He was also considering Mango's options to appeal the council's decision. Mango's license was already suspended for two years due to the mothballing of the airline, which has been in business rescue since April 16, 2021.
Going ahead, Sono intends to write to the IASC for detailed reasons regarding the council’s decision to terminate Mango’s licence, specifically in this situation where the IASC is aware of his plan to approach the courts and take legal action against the minister.
Sipho Sono is hopeful that the minister will decide on the application in the next two months. If that fails, then despite the BRP's best efforts to save the airline, he would have to initiate the wind-down that would force Mango into liquidation.