Survival was the preoccupation of businesses in 2020 as they tried to stay afloat through the economic storm brought on by Covid-19. Even before today’s crisis, the operating environment for businesses in SA was difficult: the economy and consumer spending were troubled, and burdensome regulations made it difficult for businesses to remain in business.
Then came the Covid-19 pandemic and resultant lockdown, which made an already fraught situation worse. In this environment, some businesses didn’t survive the lockdown while others looked to business rescue for a fighting chance. Business rescue is an essential mechanism for financially distressed businesses to rehabilitate their affairs. The objective is to enable a business to continue operating while being restructured, cutting costs and saving some jobs in the process.
Comair’s business rescue process has largely been successful; it attracted new private investors who pumped R500-million in the business and R600-million in operational costs were cut. Comair resumed domestic flights on 1 December and expects to add regional flights in February or March 2021.It has been more than a year since SAA, a state-owned airline, was placed under business rescue.