The world is changing fast and to keep up you need local knowledge with global context.
By Linda van Tilburg
- The government has ruled out intervention in the ongoing battle between South African Airways and unions leading the strike at SAA. Public Enterprises Minister Pravin Gordhan has refused to step in to fund the wage demands saying that negotiations were being handled by SAA’s management teams. Gordhan told unions that the pattern of bailouts had become a moral hazard when he met with them in Pretoria. He said the restructuring of SAA business was required to return the airline to profitability and said the unions were demanding salary increases for members while the airline might not even be able to pay salaries at the end of the month. In addition to growing revenues, efficiencies should be improved, and costs would need to be reduced across the board. Meanwhile ,SAA announced that it will resume flights to Cape Town, Durban and Victoria Falls tomorrow saying their domestic, regional and international flights were back on schedule.
- Assets belonging to several entities of Bosasa will be auctioned off over three days in December. The company now known as Africa Global Operations has been accused of bribery and corruption by former COO Angelo Agrizzi. Business Day reports that Park Village Auctions has been authorised to proceed to sell vast number of goods including “an entire copper plant, commercial properties, high-end furniture, commercial and passenger vehicles from entry-level to luxury SUVs”. More than 100 vehicles will be under the hammer. The auctioneer said the first property to go will be the former Bosasa headquarters and campus. Earlier this week, Jared Watson, the nephew of the late CEO of Bosasa, Gavin Watson told Biznews in an interview that he gave evidence to the South African Police Services that Agrizzi channelled tens of millions of Bosasa’s money into shell companies he owned.*
- The former chief executive of the Passenger Rail Agency of South Africa, Lucky Montana, says the decision of the South African Revenue Service to seize his assets was a “vindictive” action by SARS and that it was “unethical.” That is after the sheriff of the court arrived at his home with a warrant of execution to seize two luxury vehicles and other movable property belonging to him. Montana acknowledge that he owed SARS R1.6m after he sold two properties, but he said that he agreed to settle the amount. Montana has also claimed that the move to seize assets its aimed at pressurising him to drop aspects of his statement to the Zondo Commission.
- South Africa’s annual inflation has dropped to its lowest level in nine years. Consumer price growth slowed to 3.7% compared to 4.1% in October. The median estimate of 14 economists in a Bloomberg survey was 3.9%. It marks 31 consecutive months in which inflation has remained within the Reserve Bank’s target band of 3 to 6%. The slowdown in inflation may provide the South African Reserve Bank with room to cut its benchmark interest rate tomorrow. The Rand declined by 0.7% against the dollar in reaction to the inflation rate announcement and was trading at R14.77 at the end of trade.
- Remgro’s share price had one of its best days in the past five years after the company announced that it is planning to distribute its 28% stake in RMH to shareholders. Remgro is RMH’s largest investor and has a 4% stake in FirstRand. RMH also announced that it would sell R3.35bn in property assets. Remgro shares rose by more than 6% on the Johannesburg Stock Exchange yesterday, while RMI climbed by 5 % and RMB by 4.62%. Shares in FirstRand were down 2% on the day.
*This story is incorrect and Jared Watson has provided court documents to say as much. Please see them here.
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