South Africa’s Comair outlines details of binding offer

Comair (South Africa) (MN, Johannesburg O.R. Tambo) has revealed details of the binding offer it has chosen ahead of the publication of its business rescue plan, which is now due out on September 2. According to Southern Africa’s Travel News, Business Rescue Practitioners (BRPs) Shaun Collyer and Richard Ferguson told creditors during a virtual presentation on August 27 that the ZAR1.5 billion rand (USD89.7 million) offer includes ZAR500 million (USD29.9 million) to be used to acquire 90-99% of the airline’s shareholding. The first ZAR100 million (USD5.98 million) would be advanced in two equal tranches in September and October as secured post commencement funding (PCF). Thereafter, a stake of up to 15% may be availed to suitable B-BBEE partners within 12 months. The offer also proposes a debt-funding package of about ZAR1.4 billion (USD83.8 million) from lenders, of which ZAR600 million (USD35.9 million) would be in fresh funding (ZAR150 million (USD9 million) as a Revolving Credit Facility (RCF) and ZAR450 million (USD27 million) in aircraft finance) and about ZAR800 million (USD48 million) from the deferral of existing debt (capital and interest for 12 months and six months, respectively). The investors have also proposed ZAR200 million (USD12 million) in working capital support loans, including a ZAR100 million prepayment from local health insurer Discovery to be advanced in October. Concurrent creditors would receive a paltry ZAR40 million (USD2.39 million) given that unsecured claims against the airline total at least ZAR1.5 billion.