SOUTH African airline Comair has failed to secure the necessary funding to pull it out of financial straits, and its business rescue practitioners (BRPs) say there is no longer any reasonable prospect that the company can be rescued.
Comair, which operates Kulula.com and is the domestic partner for British Airways in South Africa, cancelled all flights on 1 June, less than three months after being grounded by the regulator over a series of safety incidents that required diversions and emergency landings.
The group went into business rescue in May 2020 after Covid-19 pandemic era lockdowns, travel bans, as well as rising fuel prices, wreaked havoc on the travel industry. The airline resumed flights in December 2020 while still in business rescue.
The airline voluntarily suspended from 1 June pending securing funding to resume operations.
The carrier’s administrators were in negotiations with an international backer with a presence in South Africa for funding, after its existing lenders and investors – a group of wealthy individuals who bailed out the airline in 2020 – said they weren’t prepared to put in more funds.
Comair’s BRPs said this week that the process to raise the necessary capital was in progress – however, these plans have now fallen through.
In a status report update published on Thursday (9 June), the BRPs said that the requisite funding could not be raised in order for the company to continue with its operations.
“Accordingly, the company’s joint business rescue practitioners give notice herewith that they no longer believe that there is a reasonable prospect that the company can be rescued,” the BRPs said.
BUSINESS TECH
