Why Comair
- Large and complex restructuring with numerous (private / public & local / global) stakeholders
- Significantly impacted by COVID and state-imposed lockdown
- Heavily regulated industry
- Required mix of operational and balance sheet restructuring
Background
- Leading regional airline operating leading brands
- British Airways franchise and Kulula LCC
- Financial challenges pre-COVID due to SAA claim unpaid, grounding of Boeing MAX and unsustainable cost base
- 2,200 jobs directly at risk of loss
Engagement
- Engaged by board of directors in March 2020 and managed entirely by remote (via Zoom and MS Teams) for 9 months
Key actions undertaken
- Identified the root causes – set a plan to address and approached funders (shareholders and banks) to secure financing
- Provided leadership in crisis, alongside the management team
- Focused on resolving liquidity needs so as to have the capacity to execute the turnaround plan (managed cashflows daily)
- Assumed the role of BRP following extension of the lockdown
Key outcomes
- Prepared a restructuring plan and set to implement within accelerated timeframes, focused on:
- Securing near-term liquidity from banks
- Introducing a long-term equity solution (executed a comprehensive equity capital raising process)
- Resolving operating issues daily
- Acted quickly to reduce cost base and focus on cashflow
- Funders took comfort from quick wins
- Prepared a return-to-flying project plan inclusive of timelines, funding requirements and stakeholder engagement
Where we are today
- Secured equity solution from consortium of investors; complemented by additional debt solution from banks
- Return-to-flying project plan established
- Adopted fully-funded business rescue plan
