South Africa’s oldest private airline in liquidation after failing to raise funds

0

Comair Airlines is parked on the tarmac at Cincinnati International Airport in Hebron, Kentucky, in this March 26, 2001 file photo.

Join now for FREE unlimited access to Reuters.com

Register

  • 75-year-old airline hit hard by pandemic
  • Comair operated the British Airways franchise in South Africa
  • Tourism Minister fears other airlines will raise prices

JOHANNESBURG, June 9 (Reuters) – South Africa’s oldest private airline, Comair, will cease operations for good after its bankruptcy protection lawyers on Thursday filed for liquidation of the company which does not had failed to secure funding to remain airborne after being severely impacted by the global pandemic. travel restrictions.

The end of the company, whose neon green planes of low-cost carrier kulula.com had dotted the tarmacs of airports across the country, comes after two years of interventions by lawyers, investors and protection workers against bankruptcy to save the 75-year-old airline.

“We did everything we could to get the funding, but when we couldn’t we didn’t have the opportunity to file the application,” said Richard Ferguson, the company’s business rescue practitioner. company, a class of lawyers hired as administrators to save a company from liquidation, said in a statement.

Join now for FREE unlimited access to Reuters.com

Register

“This is an extremely sad day for the company, its employees, its customers and South African aviation.”

Comair, along with flag carrier South African Airways, were the two hardest hit domestic airlines after the COVID-19 pandemic forced countries to close international borders.

Tourism Minister Lindiwe Sisulu said the airline’s closure would have a negative impact on the sector.

“We hope that the grounding of Comair flights will not cause other airlines to raise their prices,” she said in a statement.

In November 2020, its board members and executives agreed to inject 500 million rand ($32.78 million) in equity as part of a bailout.

However, the ‘red listing’ of South Africa by foreign countries due to the Omicron variant of the coronavirus, the suspension of flights in March for security reasons and rising crude prices have resulted in an injection of funds more immediate to keep it airborne, its administrator said.

Comair employees and customers who held reservations or owed refunds will now become creditors of the company, its administrator said.

($1 = R15.2538)

Join now for FREE unlimited access to Reuters.com

Register

Reporting by Promit Mukherjee Additional reporting by Bhargav Acharya Editing by Bernadette Baum

Our standards: The Thomson Reuters Trust Principles.

Share.

About Author

Comments are closed.