Air Zim revival underway, debt assumption key says Judicial manager

03 May, 2019 - 14:05 0 Views
Air Zim revival underway, debt assumption key says Judicial manager

eBusiness Weekly

HARARE – The revival of Air Zimbabwe is underway with the arrival of an Embraer plane on Tuesday with two more Boeing 777-200ER expected to be delivered by the end of June, an official said Thursday.
Air Zimbabwe administrator Reggie Saruchera of Grant Thornton chartered accountants, who the government gave the tricky mission to revive the nearly defunct national airline, said while a turnaround plan had been developed and was awaiting approval, unburdening the firm through the assumption of its $380 million debt was key to unlocking its potential.
“Air Zimbabwe is saddled with a $380 million debt of which $30 million is owed to foreign creditors. $292 million is owed to government related institutions,” Saruchera said.
“The debt assumption is a pre-requisite to the turnaround of the airline and the coming on board of a strategic partner.”
Air Zimbabwe was placed under reconstruction in terms of the Reconstruction of State-Indebted Insolvent Companies Act in October last year.
A month later, Saruchera met with the airline creditors and is currently in the process of verifying their claims.
He said key to Air Zimbabwe’s turnaround plan was the acquisition of aircraft and disposal of redundant equipment and absolute spares.
“The proceeds from the disposal of redundant aircraft equipment and spares will allow the airline to raise some capital for the acquisition of additional aircraft and working capital,” he said.
The airline on Tuesday took delivery from the United States of an Embraer plane, which can take up to 60 passengers and is awaiting the delivery of an additional two bigger planes from Malaysia in eight weeks time.
At its prime, the airline had six aircraft and flew to various regional and international destinations.
Most of the destinations were however scrapped as the airline went through upheavals caused primarily by mismanagement coupled with running old aircraft.
Saruchera said Air Zim had been using inappropriate aircraft which made the business unviable.
“The acquisition of short haul Embraer aircraft and two other medium range aircraft will enable Air Zimbabwe to develop a robust domestic and regional route network,” he said.
He said the Embraer would be deployed to service local and regional routes once its registration process was completed.
While the registration process was going on, Saruchera said the identification of a strategic partner for the airline was underway, but would only be finalised after an agreement was reached with the Ministry of Finance and Economic Development on assumption of the airline debt. – New Ziana

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