V&A Waterfront stake for sale
23 February 2005
The state plans to sell its stake in Cape Town's V&A Waterfront – one of SA's top tourist attractions – as part of its policy of selling off its non-core businesses, Public Enterprises Minister Alec Erwin told journalists in Parliament last week. The government is also on the look-out for strategic equity partners in the fields of energy and logistics.
The V&A Waterfront, a mixed-use property development located around the historic Victoria and Alfred Basins which formed Cape Town's original harbour, attracts up to 20 million local and international tourists annually.
State company Transnet currently owns 26% of the V&A Waterfront, with the rest owned by the parastatal's pension fund.
The move was in line with the government's policy of selling off all non-core businesses, Erwin said, including housing books (loans), plastic and protein manufacturing companies, business-to-business software companies, and "assets in Cape Town Harbour".
"We intend disposing of the V&A", the minister said, adding that the government intended to sell such assets completely and not retain a share in the businesses.
State asset privatisation
While the state would remain a major shareholder in Transnet, South African Airways, electricity supplier Eskom and weapons manufacturer Denel, it was looking for investors, Erwin said.
For example, joint investment schemes were currently being established between Transnet and large iron ore mines in the Northern Cape, and between Eskom and independent power producers.
The government recently announced five-year investment plans for state-owned enterprises in energy and logistics, and was looking to these sectors to attract foreign investment and boost economic growth, the minister said.
While the ideas of selling Eskom or Transnet to the private sector made no economic sense, Erwin said, "[the idea of] bringing in private cash does".
It is estimated that R107-billion will be needed between 2005 and 2009 to meet the country's growing energy needs. Eskom plans to invest R84-billion over the next five years, with the balance of R23-billion reserved for independent power producers.
The government would not be seeking a strategic equity partner for South African Airways, however, though it would consider other possibilities. "We have had experience with equity partners, but it's not the right time in the global airline industry", the minister said.
At the same time, Erwin was upbeat on the airline's future. SAA is in the process of being separated from Transnet's balance sheets - this should be finalised by 2006 - and he was expecting SAA to make good progress this year, the minister said.
SouthAfrica.info reporter
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