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New airport seeks second empowerment partner.

Posted On Tuesday, 22 October 2002 10:01 Published by
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Apart from a 10% equity stake, local Mpumalanga community would get R5 for every passenger passing through.
International power and automation group ABB is seeking an empowerment investor to take a 40% stake in the new R350m international airport at Nelspruit.

The move would mean that half of the equity in SA's newest international airport would be in local hands.

This was announced by the CE of the Kruger Mpumalanga International Airport (KMIA), John Manning, at a ceremony yesterday to mark the opening of the airport and its handover from the contractors to the new management team.

Earlier yesterday, the first commercial flight into the airport, an SA Airlink flight from Johannesburg, touched down on the 3,1km airstrip, which is long enough to take the world's largest Jumbos for passengers en route to the nearby Kruger Park.

Manning said that there was already a 10% stake in the airport which had gone to the local Mbuyane community and now a second empowerment investment was being sought.

'Local investors will have an opportunity for significant equity participation in our operation,' he said.

'We are looking for a 40% black economic empowerment partner in the project, and we are hoping for a deal early next year.

'We are looking at an investment from one of the larger black empowerment players.

ABB built the airport in a record 18 months, in partnership with Aveng subsidiary Grinaker LTA. 'I have been involved in projects around the world, and I have never before worked with such a co-operative team as we have had here,' said Manning.

Scheduled flights which previously had gone to Nelspruit or Skukuza airports will now come to the new airport.

Nationwide is expected to begin flights from Johannesburg and Cape Town from December at the latest, and an aggressive international marketing campaign is under way to attract intercontinetal traffic with the aim of bringing a extra 1-million tourists into SA within five years.

Britain and the rest of Europe are the first to be targeted, but potential has also been identified in the US, Asia and possibly the Middle East as well. There is also tremendous potential for cargo, and an expectation that this will overtake passenger traffic in importance over time.

'This runway is as narrow as the other Nelspruit airport runway is long,' joked SA Airlink's Deryl Boast, who piloted the first scheduled flight into KMIA airport. 'It's a beautiful airport, and the infrastructure is up and running.'

The airport won its licence to operate on Friday last week, but it will be some weeks before control tower functions are transferred from the older Nelspruit airport, as some red tape needs to be gone through.

Meanwhile, there are procedures to be concluded to allow international fights to land at KMIA. 'We hope there will be intercontinetal flights from the first quarter of next year,' said Manning. He said that 5-million cubic metres of earth and stone have been moved to build the new runway. 'We flattened two koppies and filled the valley in between,' he said.

ABB senior vice-president Per Wanland said that it was important to bring empowerment partners into the ownership of the airport, but that ABB had been proud of its role in leading the project.

As well as holding a 10% equity stake in the airport, the Mbuyane community will get R5 for each passenger passing through the airport, with the revenue going to upliftment projects. The community has also agreed to help tackle security concerns, such as the theft of electric cables.

ABB CE for SA Carlos Poe predicted that the new airport would provide a major boost to tourism, as it lay just 40km drive from the Kruger Park.

He believed that along with the Victoria Falls and Cape Town, the Kruger Park was one of southern Africa's big three tourism destinations, and extra visitors would come to SA as soon international tourists could fly direct to the KMIA without having to transit through Johannesburg. 'It will also provide sustainable business and employment opportunities for people in the region,' he said.

About 100 permanent jobs are expected to be directly created by the airport, the majority of which will go to the local community.

ABB SA itself recently announced a major 25% black economic empowerment deal.

Business Day

Publisher: Business Day
Source: Business Day
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