ON THE MONEY
STUART THEOBALD: SAA and Acsa are giant red flags for private investors in SOEs
There is no sucker unwise enough to take a minority stake in return for their capital and expertise
I suppose it is progress that the ANC’s national executive committee now accepts the importance of introducing “equity partners” into underperforming state-owned enterprises (SOEs). The problem is that the idea — giving outside investors minority stakes in return for their capital and expertise — isn’t going to fly. There is no sucker unwise enough to take such a deal, especially given the government’s history of abusing minority shareholders.
We proved it first with the introduction of private shareholders at SAA. Back in 1999 Swissair took a 20% stake, but when it became clear that the government wasn’t going to follow through with full privatisation, the Swiss got out.