Cape Town – The growth of low-cost airlines in South Africa was “unstoppable”, Glenn Orsmond, chief executive of 1Time, said yesterday.
Confirming that 1Time held talks with would-be investor Allan Reddy, the chief executive of black economic empowerment tourism firm Satlog, Orsmond said: “We always have people knocking on our door.”
But, he said, the four founding shareholders, who have 80 percent of the firm, did not intend to sell control.
Orsmond said that three-year-old 1Time had an estimated 11 percent of the domestic airline market and had grown by 20 percent since SAA’s rival low-cost airline Mango launched last October. It made a profit of R20 million in the past financial year.
Its listing on the AltX index on August 14 aims to raise R30 million to expand all three of the firm’s divisions: the airline, a charter operation and aircraft maintenance firm Aeronexus.
Orsmond said 1Time was valued at R200 million and was preparing to offer 200 shares at R1 apiece in its planned listing, which would leave founding shareholders with 50 percent.
The empowerment shareholders are a consortium with 5 percent, led by 1Time’s non-executive chairman, Sipho Twala, the executive director of Safomar aviation group. Durban-based aircraft leasing firm Avstar has 15 percent.
The remaining 80 percent of 1Time, which includes a charter firm and aircraft maintenance firm Aeronexus, is held by the four partners who started the airline from scratch, including Orsmond and Rodney James, the operating and marketing director.
The airline is taking delivery of two more McDonnell Douglas MD 87s from the US.
Dismissing suggestions by Gidon Novick of British Airways/Comair that SAA was using Mango’s low prices to put rivals out of business, Orsmond said that although Mango had special offers to stimulate business, the time for sustained price wars was over.