Restructuring for Fly Blue Crane
Fly Blue Crane became the latest South African airline to hit turbulence when it filed for a voluntary application for business rescue late last year to facilitate the rehabilitation of the company. By opting for business rescue, the company was taking a step many of its peers around the world had taken in order to re-engineer and strengthen their businesses, the company said last November.
The move came shortly after Fly Blue Crane launched flights to Mthatha, Eastern Cape. Naude said as a result of the business rescue application the company would operate under the supervision of a business rescue practitioner, as the restructuring of the company takes place.
He said Fly Blue Crane, which has flights to Cape Town, Kimberley, Mthatha and Bloemfontein, was evaluating its routes as part of its re-engineering programme, “including the fine-tuning of its schedules to some destinations during low seasons - such as the end-of-year break when business customers in some markets are away on holiday.
“This occasionally means pulling back on the number of flights to such destinations during these periods, with normal service resuming as soon as the core travelling base is back,” said Naude. The company started flying in September 2015, entering a market that had seen the demise of other low-cost airlines such as Nationwide Arlines, 1Time and Velvet Sky, among others.
“I am very confident about the airline’s future, and have every reason to believe that it is a matter of time before Fly Blue Crane overcomes its challenges. Yes, there is lots of hard work ahead, but all is well and the airline is operating as usual and servicing its routes. The management and staff are here and working very hard, and looking very motivated and determined,” he said.
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Naude said he had met all of Fly Blue Crane’s major business partners, and they had pledged their support. “It is for these reasons that I’ve no doubt that the business rescue process will provide the company with the opportunity it needs to restructure its affairs, enter into and conclude its discussions with potential key strategic partners, and negotiate workable payment arrangements with creditors,” he said.
Naude said, while the business rescue process was not yet as widely practised in South Africa as it was globally, it was on the increase and allowed for the restructuring of companies to the benefit of all stakeholders, including creditors and employees. “As unfortunate as it is, it is normal for companies to find themselves in distress due to any number of circumstances which can be overcome given time, support and diligent management.
In that event, the business rescue process provides companies with the requisite space to re-organise and restructure their operations, while saving jobs and continuing to trade normally,” he said.