Fly SAX, the SPV (special purpose vehicle) set up by SA Express employees in an effort to save their jobs, has won the bid to buy the airline, which could take to the skies again as soon as early 2021.
Uprise Africa will facilitate the raising of capital for SAX employees to achieve their goal through its equity crowdfunding platform. A legal and financial due diligence process will take place to evaluate the attractiveness of the investment opportunity and to protect investors against liability before the pitch goes live. The due diligence will be carried out by external aviation experts, facilitated by the anchor investor, who has shown keen interest in subscribing for shares before it is open for the initial public offering.
Thabsile Sikakane, spokesperson for Fly SAX, said the airline could take to the skies again in early 2021. The new owners would look at starting off lean, using smaller aircraft to service the more profitable routes from the airline’s existing network and added that Fly SAX hoped to operate both domestically and regionally.
She explained that the airline would be recapitalised entirely by funding from its anchor investors plus monies raised by opening up the crowdfunding platform to employees and the public.
Sikakane also denied rumours that employees would be asked to use their pension investments as collateral for the purchase of shares, labelling them untrue, and adding that the scheme would incorporate a number of safeguards to protect new investors.
“Uprise Africa will adopt robust practices by demonstrating that selection processes are clear, fair and not misleading,” explained the company’s Head of Media Relations, Vuyisa Qabaka. “A screening process will be put in place to identify sophisticated and non-sophisticated investors. If an investor is deemed ‘non-sophisticated’ these investors would be urged to invest no more than 10% of their nett investable assets via the equity crowdfunding platform. This is to prevent non-sophisticated investors from allocating a disproportionate amount of their nett worth to this alternative asset class.”
Investors will be able to buy shares through the website uprise.africa. Investor registration will start in October and the portal will be open for registered organisations and individuals to make investment pledges in November. The listing of the joint venture on ZARX (an alternative stock exchange) will also provide equity crowdfunding investors with options to trade shares and provide an equity strategy for investors who do not want their funds to be tied up for several years.