Comair asks for more time for business rescue plan


Comair asks for more time for business rescue plan

Published Date: 2020-07-29 | Source: Stephen Gunnion | Author: Stephen Gunnion

Comair asks for more time for business rescue plan

The business rescue practitioners need another month to finalise short-term bridge funding and advance two offers from potential investors.

Comair has asked its creditors to give it an extra month to formulate a business rescue plan as it negotiates short-term bridging finance and mulls offers from potential investors.

The airline operator's business rescue practitioners (BRPs) said yesterday they had received proposals from a number of consortia to provide funding. However, in order to assess them properly, including the conditions they come with, they needed more time. Publication of the business rescue plan was previously extended to 28 July.

Comair, which operates and has a licence agreement with British Airways in South Africa, entered business rescue and asked the JSE to suspend trading in its shares in May after the national lockdown grounded its aircraft, cutting off revenue. At the time, it said its business model remained sound and it expected to resume operations once restrictions had been lifted.

The BRPs, Shaun Collymer and Richard Ferguson, said an unsigned non-binding expression of interest from one consortium in June wasn't taken forward after it was declined by the main funding source's pre-credit committee. However, in the past week it had received two more offers, one binding and one non-binding, from two more consortia, both containing material conditions to be satisfied.

The BRPs requested an extension for the rescue plan to 28 August. In the meantime, they were in the process of negotiating short-term bridge funding as post commencement finance, which it required on an urgent basis to meet current overheads and expenses and support its business rescue activities.

Comair's shares were trading at 100c when they were suspended after declining 67% since the beginning of the year.

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