South Africa’s Airlink, Safair to Merge

 - November 27, 2017, 11:17 AM
A FlySafair Boeing 737-400 prepares to approach Cape Town. (Photo: Safair)

South African airlines Airlink and Safair applied to the country’s competition commission on Tuesday for approval to merge under the Airlink group of companies. The proposal calls for Airlink and Safair’s various businesses, including low-fare carrier FlySafair and humanitarian aid operations, to continue to operate separately under their own brands. Plans call for the airlines to retain their respective fleets and leadership teams, and the companies promise no job losses as a result of the consolidation. Meanwhile, Safair shareholder ASL Aviation Holdings—a global aviation group whose financial interests also include six European and two Asian airlines--will become a minority shareholder of the Airlink group of companies.  

“Airlink’s acquisition of Safair, which is financially robust and profitable, makes good business sense,” said Airlink CEO Rodger Foster. “It presents opportunities to reduce our combined costs, position ourselves for growth while at the same time increasing connectivity and choice while making air travel accessible and affordable for our customers across Southern Africa...Our combined networks will enable us to connect 37 destinations in nine Southern African and Indian Ocean countries and St. Helena. This will stimulate and enable trade, tourism, economic growth and social development in those markets we serve.”

Perhaps more important, the companies expect the merger create more effective economies of scale by allowing them to share costs and remove systems duplication, according to Safair CEO Elmar Conradie.

The competition commission has indicated it would hand down its final determination during next year’s first quarter.

Established in 1992, Airlink ranks as the largest regional airline in Southern Africa, maintaining a route network of 37 destinations in nine African countries and St. Helena with a fleet of 33 Embraer ERJ-145-family jets, eight Jetstream 41 turboprops and 12 Avro RJ85s, all of which it expects to replace with Embraer E-Jets by the end of 2019.

Safair launched FlySafair in 2014 to serve South Africa’s domestic market, where it flies low-fare services with three Boeing 737-800s, six 737-400s and two 737-400 cargo jets.