Comair’s business rescue practitioners, Shaun Collyer and Richard Ferguson, held the first formal meetings with creditors and employees today (May 19), according to a press release.
The next step in the business rescue process is the formation of a creditors’ committee, and an employee representatives' committee. Creditors wishing to submit claims can download claim forms from www.comair.co.za/business-rescue/creditor-claims
Shaun said Comair had reported a half-year loss of R564m for 2020, which included R790m that was irrecoverable after SAA entered business rescue in early December 2019. The money was for outstanding payments still owed on a R1,1bn settlement in a Competition Commission complaint.
As a result of the Covid-19 lockdown, Comair had been unable to operate any scheduled passenger flights from March 26 and consequently had not been able to earn revenue. When the government announced that the lockdown would be lifted in phases, and domestic flights would only resume in phase 2, Comair “had no choice” but to file for business rescue.
Shaun said it was important to distinguish between factual and commercial insolvency, as Comair is not factually insolvent. It has R7,42bn in assets on its balance sheet, compared with liabilities of R5,48bn. Rather, it is financially distressed because there is insufficient cash to pay ongoing costs and obligations and, with its flights grounded for an uncertain period, no opportunity to generate revenue.
The business rescue plan would probably be published on June 9, and the vote to approve the final plan was expected on June 24, the release said.