Safair Operations (Pty) Limited (Safair) announced the conclusion of its full Broad-Based Black Economic Empowerment (BBBEE) transaction, making it the largest aviation employee share scheme in South Africa.
The Employee Share Ownership Plan (ESOP), NdizaSafair Employee Trust, will empower Safair’s staff to participate in the ownership of the airline.
“We are delighted to be sharing this news as we have been in the process of setting up this BBBEE deal for the past seven months. We disclosed as much to the Air Services Licensing Council in May during our initial application for FlySafair’s operating license” explains Dave Andrew, CEO of Safair.
As part of the BBBEE deal, the shares previously held by Hugh. Flynn were repurchased, , thereby also removing any possible concern about foreign shareholding. At the same time Elmar Conradie and Dave Andrew consolidated their shareholding into an investment vehicle, the Safair Investment Trust, and Wimpie Davidson, the airline’s Operations Director has also become an investor therein. The result is that Safair now has one class of ordinary shares with no differences in economic or voting rights.
“Further, we are extremely proud to say that Safair is the first aviation company in South Africa to have set up such an extensive and full ESOP for staff. While other aviation companies may have something similar, their shareholder percentages represented are smaller in comparison to their workforce,” continues Andrew.
The ESOP allows all existing and future previously disadvantaged permanently employed staff members of Safair, some of whom have worked for the company for more than 30 years, the opportunity to participate in the growth and ownership of the airline.
As part of the setup, Safair made a contribution to NdizaSafair to enable it to subscribe for 25.1% of the ordinary shares in Safair. There will be no debt funding and all of the benefits will accrue immediately to the participants in the ESOP. Safair will also pay a preference dividend to NdizaSafair to ensure that the participants are assured economic benefits even during the difficult start-up phase of the airline. In addition, Dumisani Mthombeni, one of the elected trustees of NdizaSafair Employee Trust, was appointed as a director of Safair.
“NdizaSafair and the Safair Investment Trust hold 25.1% and 49.9% of Safair’s shares respectively, while the Irish-based company ASL Aviation Group has a 25% indirect interest in Safair through its shareholding in Safair Holdings.
“The ESOP allows us to continue to adhere to the Air Services Licensing Act, where 75 percent of our voting rights are held by South African residents.As the employees partaking in the ESOP are all South African residents, there can no longer be any possible confusion as to the residency and citizenship of our shareholders,” adds Andrew.
Safair has been operating in South Africa and worldwide for almost 50 years and has a successful history of delivering specialist aviation services with global scale and capabilities.
“We are really pleased to have involved our staff in the ownership of the airline and providing them with an opportunity in which they can benefit from our commercial activity. Keeping all our stakeholders in mind, passengers, suppliers and staff alike, we remain committed to the launch of FlySafair as soon as possible” concludes Andrew.