Mango airlines have yet to resume operations after being grounded and placed under business rescue in July 2021 due to financial difficulties, including R2.91 billion owed to creditors.
The airline, once a preferred choice among travellers for its affordable fares, offered its loyal passengers a sense of hope despite experiencing significant challenges.
When a private buyer expressed interest in revitalising the company and restoring it to its former status, Aviation Co-ordination Services (ACS) intervened, indicating concerns that the
prospective buyer was primarily interested in acquiring the stateowned entity at a minimal cost. Concurrently, CSA objected to the approval of the current business rescue plan, arguing that it would incur greater losses compared to other creditors.
ACS went to court to prevent the transfer of shares to a private company and stop the business rescue plan implementation.
The High Court ruled that a section of the business rescue plan adopted by creditors was “invalid”.
Mango’s business rescue practitioner (BRP), Sipho Sono, plans to appeal the ruling that has delayed the transfer of shares to a new company. Sono stated that he has instructed his legal representatives to appeal the Gauteng High Court, Johannesburg, judgment which halted the implementation of the business rescue plan.
This follows Judge Denise Fisher finding that “the plan, shorn of its complexity, amounts to nothing more than the confiscation of the creditors’ claims in order that they be transferred by Sono to an investor who pays no value for them or the shares”.
Mango owes ACS more than R23.3 million and was one of the few creditors who opposed the business rescue plan, which 98% approved.
In his most recent communication to stakeholders, on June 17, the Gauteng High Court in Johannesburg delivered a judgment regarding the application submitted by ACS.
The court declared that the compulsory cession outlined in clause 6.2.6 of the business rescue plan is invalid and unenforceable.
The court also declared that the business rescue plan cannot be implemented.
