South African Airways (SA, Johannesburg O.R. Tambo) is to be spun off into separate entities and sold to willing buyers, the ruling African National Congress (ANC) party has resolved.

According to party sources who spoke to The Sowetan newspaper, the resolution was passed during a national executive committee (NEC) meeting last week. An earlier plan to sell off the state-owned airline as a whole was rejected given its heavy debt overhang.

“The person you are going to sell SAA to, you will have to give them money, not them giving you money, which is a loss,” said ANC economic head Enoch Godongwana. “It has been mismanaged; I doubt if it owns its fleet, it’s probably a leased fleet. So there’s no asset, I doubt if it even has that, I mean I can’t vouch for it."

SAA was not immediately available for comment.

At present, SAA has four wholly-owned subsidiaries; low-cost carrier Mango Airlines (JE, Johannesburg O.R. Tambo), MRO firm SAA Technical, catering unit Air Chefs, and the South African Travel Centre, a retail travel business with franchises in South Africa and some other African states. SAA also maintains two other substantial non-corporate businesses namely SAA Cargo and its frequent-flyer programme SAA Voyager.

Earlier this week, South Africa's Minister of Public Enterprises, Pravin Gordhan, told the country's National Assembly that neither South African Airways nor South African Express (XZ, Johannesburg O.R. Tambo) had not been able to present their FY2018/19 annual reports, audited financial statements and audit reports by the required September 30 deadline. In a letter, Gordhan said the required statements would only be tabled as soon as the two carriers' perennial inability to remain going-concerns had been resolved. By this, Gordhan implied the two airlines would likely have to secure further state funding.

"Both airlines are experiencing serious financial challenges and are unable to meet going concerns," he said adding that SAA requires more time to submit information to the Auditor General, while SA Express has been unable to finalise its annual financial statements due to "financial constraints".

"Government remains committed to find a sustainable solution to the challenges facing the airlines," he added.