Comair secures capital inflows of R270 million
Comair reached another milestone in the business rescue process with capital inflows of R270 million.
September 21, 2021: Following the resumption of scheduled flight operations on September 1, after a temporary suspension as a result of level 3 Covid-19 travel restrictions, Comair reached another milestone in the business rescue process with capital inflows of R270 million.
This follows the sale of Comair’s SLOW Lounge business to FirstRand Bank for R250 million and receipt of a R20 million payment from South African Airways (SAA).
The SLOW Lounge transaction will require an amendment to the business rescue plan, a notice of which has been dispatched to affected persons.
The R20 million distribution from SAA’s business rescue practitioners is part of the R1.1 billion the state-owned enterprise owed Comair in settlement a damages award for anti-competitive behaviour. SAA paid an initial amount of R289 million in February 2019, with the balance payable in installments until July 2022. These payments ceased when SAA entered business rescue in December 2019.
Richard Ferguson, one of Comair’s business rescue practitioners, says the capital injection is a significant step towards the successful conclusion of the business rescue process.
“There is still work to be done but these capital inflows, the fact that Comair is back in the skies and again earning revenue coupled with the commitment by the investors to support the viability and sustainability of the business all point to a positive outcome.”
Comair, which operates kulula.com and British Airways (operated by Comair), temporarily suspended services on July 5, 2021 in response to the implementation of an adjusted Level 4 lockdown, the prohibition of all non-essential travel in and out of Gauteng and low demand for air travel.