The business rescue practitioners for embattled airline Comair expect to publish a rescue plan on June 9, saying there is a reasonable chance of rescuing the business given its asset base and its importance in terms of SA’s travel infrastructure.
The company has appointed Shaun Collyer and Richard Ferguson as joint business rescue practitioners. They held their first formal meeting with creditors and employees on Tuesday. The business rescue plan will probably be published on June 9, and a shareholder vote to approve it will take place on June 24, the practitioners said in a statement.
Comair had assets of R7.42bn on its balance sheet compared with liabilities of R5.48bn, and was not insolvent, but rather financially distressed, the practitioners said. Comair was also important to SA’s infrastructure, had good standing in the eyes of the public, and was competitively well placed, having enjoyed a 39% market share for domestic travel, the statement read. Due to this, there are “Comair, which operates British Airways flights and Kulula in SA , entered business rescue on May 5. It is a form of bankruptcy protection that allows financially distressed companies to delay creditors’ claims against them or their assets.
The business rescue practitioners will oversee the restructuring of the company to work out if it can survive or if assets should be auctioned off to pay off creditors. They are receiving claims from creditors, and the next step in the business rescue process is the formation of a creditors’ committee and an employee representatives’ committee.
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