Gov’t finalises deal with Air Namibia lessors

The Namibian government is finalising a deal with Castlelake over NAD2.5 billion Namibian dollars (USD176 million) owed to it by defunct national carrier, Air Namibia (SW, Windhoek Int’l), for two A330-200s since returned to the lessor. The country’s public enterprises minister, Leon Jooste, told The Namibian newspaper the parties were in the final stages of an arrangement regarding penalties concerning the premature cancellation of the aircraft leases, following the voluntary liquidation of the national carrier in March 2021. He did not divulge the actual amounts being discussed. “We have been negotiating with the lessor for several weeks and will finalise the lease termination agreement soon,” Jooste said. Under the terms of the contract, the government had provided a guarantee of up to NAD2.5 billion for the 12-year aircraft leases, while a security deposit of NAD94 million (USD6.6 million) would be forfeited if the contract was breached. The failed carrier had been unable to keep up lease payments of NAD32 million (USD2.2 million) per month for both aircraft. Meanwhile, the Namibian Sun newspaper reports the government had so far paid out half – NAD139 million (USD9.7 million) – of a promised NAD278 million (USD19.5 million) ex gratia payment to about 600 former Air Namibia employees. Jooste said the remaining NAD139 million would be dispersed in July 2021. In addition, the liquidators had paid out severance packages totalling NAD105 million (USD7.3 million) by the end of April 2021. At the time of its closure, Air Namibia’s liabilities outstripped its assets by more than NAD4 billion (about USD282 million) with the biggest liability being the cost of terminating the aircraft leases.