BRP to go ahead with sale of Mango

The business rescue practitioner (BRP) of low-cost airline Mango says he is proceeding with selling the airline after public enterprises minister Pravin Gordhan failed to meet a deadline set by the high court to make a decision on the proposed sale as required by the Public Finance Management Act.

The rescue practitioner, Sipho Sono, said in his latest business rescue report that he had written to the minister on January 31 informing him he assumed the approval had been granted in terms of the act as per the court order.

On December 13 2023 the high court in Pretoria ruled that Gordhan had 30 days to either approve or reject the sale proposed by the business rescue practitioner. The court said if the minister failed to do so, it would be assumed that he had approved it. The minister also failed to petition the Supreme Court of Appeal (SCA) in time for leave to appeal against the high court decision, by filing the petition late.

The court directed Gordhan to communicate the outcome to the rescue practitioner and SAA, and to furnish reasons for his decision. Instead, Gordhan and finance minister Enoch Godongwana filed notices for leave to

appeal against the judgment.

The application was heard at the end of November. In midDecember the court dismissed the ministers’ application for leave to appeal.

However, Gordhan appears not to be throwing in the towel yet. His department told Business Day on Friday the matter is still sub judice.

“This matter is a subject of further court proceedings. The rescue practitioner continues to defy all requests for transparency and vital information on which proper due diligence can be done,” a statement by Gordhan’s office reads.

In his latest status report, released at the beginning of February, Sono said that in terms of the high court order he is now entitled to assume that his application for approval by Gordhan in terms of the act has been granted. Accordingly, Sono said he would proceed with the investor process, “the effect of which will be the outright sale of Mango to the successful bidder identified by [Sono] in 2022”.

The identity of the chosen bidder has not been officially announced.

Sono said he has obtained legal advice indicating that if a petition were to be belatedly filed — as was the case with Gordhan’s petition to the SCA — the principal judgment’s order remains executable.

Sono has claimed in the past that Gordhan was stalling on the issue because he wanted to see the business case of the selected investor before making a decision. This raised concerns about the sharing of information as Mango will probably compete with its parent company, SAA.

Gordhan and his department have claimed in previous court documents that the minister wanted to ensure that all aspects of Mango’s business rescue process “are transparent, legally sound and in the best interest of the SA public”. They denied that the delay in making a decision was a stalling tactic or an attempt to undermine the need to bring finality to Mango’s business rescue process.

If the sale of Mango fails, Sono will have to implement a wind-down process in terms of the business rescue plan.

The minister received Sono’s application in terms of the act for approval of the sale in November 2022.

Sono said in earlier court documents that he had already made it abundantly clear in the past that no further information would be forthcoming from him apart from what had already been provided to the department and the minister.