By Lehlohonolo Lehana.
The business rescue practitioner (BRP) for Mango Airlines has warned that the group may have to abandon its rescue plan after Minister of Public Enterprises, Pravin Gordhan withheld his approval within the 30-day time frame.
In the fourteenth business rescue update for the group, the BRP said that a sudden turn of events had clouded the airline’s successful turnaround prospects.
The national carrier initially submitted an application to sell Mango on September 30. The BRP handed in another application on November 28 to the Department of Public Enterprises, who had 30 days to make a decision. However, the Minister is still yet to give his verdict.
This delay means Mango Airlines and investors may have to part ways, which would result in the wind-down of the once loved airline. In an effort to avoid this, BRP added that they are currently assessing whether the concerns raised can be resolved and will give feedback in respect of all parties involved.
South Africa’s budget carrier has been seeking new ownership for the past 18 months since ceasing operations. There was a deal agreed upon for Mango to be bought by August 2022, but on the 7th of that month, the airline’s flying license was suspended for two years.
The licenses that allowed Mango to fly had been suspended by the Air Services Licensing Council (ASLC) because the airline had been out of operation for over a year. Without these licenses, parties that were willing to invest in the state-owned carrier may have walked away.
Mango has not flown since July 2021, just before entering a business rescue plan similar to that of Comair.
Mango had hoped that Gordhan would approve the sale of the airline before the deadline. The minister’s delay means that the future of the domestic airline hangs on a knife edge.
South Africa’s airline industry has been hit with several high-profile liquidations over the last year, with both Comair (Kulula) and SA Express being shut down.