Business / Companies
Airzim in frantic search for funds to save plane from being auctioned in London
13 Dec 2011 at 21:11hrs | Views
AIR Zimbabwe is rushing against time to raise funds to secure the release of a plane that was seized in London before it is auctioned on Wednesday.
On Tuesday Airzim officials said they had made "significant" progress in mobilising money to settle the over US$1 million debt over which the plane was impounded.
The Boeing 767-200 was impounded by a US company, American General Supplies, at Gatwick International Airport on Monday. The company supplies the bulk of spare parts to Airzim.
Airzim acting chief executive officer Mr Innocent Mavhunga on Tuesday said: "We are still mobilising the resources and we have made significant progress though I am not at liberty to divulge what we have. As for the stranded passengers, we are rerouting and refunding where possible. Others are still in hotels."
Mr Mavhunga said nothing had been communicated to the national airline with regards to today's pending auction. Airzim on Monday said Treasury had failed to release funds to bail it out. Last week, another Airzim plane Boeing 737-500 was grounded by a South African company, Bid Air over a US$500 000 debt.
Bid Air demanded the money for ground handling services rendered to the airline, but later released the plane after negotiations.
Mr Mavhunga told legislators in October that the national airline owes suppliers and other service providers US$137,7 million with US$112,7 million owed to Zimbabwean firms while US$25 million is owed to foreign companies. A former Airzim chief executive officer, who spoke on condition of anonymity, said the future of the airline relied on good corporate governance and personnel with relevant skills.
"For instance we have had about four or five lawyers being appointed as CEOs or managers yet they did not have any aviation knowledge," he said.
He said Government should appoint a board with aviation expertise. He said the board should be allowed to appoint an aviation expert as a CEO who will in turn appoint directors who have an understanding of the aviation industry.
"After those appointments, Airzim should be able to operate viably and that is when Government can consider taking over the debt, because taking it over now will not solve the underlying problems. After that, one can then look for a strategic partner because the airline's value would have been improved.
"It's not possible to go for a partner now when you have a negative balance sheet and if anyone comes now they will get it for a song," he said.
On Tuesday Airzim officials said they had made "significant" progress in mobilising money to settle the over US$1 million debt over which the plane was impounded.
The Boeing 767-200 was impounded by a US company, American General Supplies, at Gatwick International Airport on Monday. The company supplies the bulk of spare parts to Airzim.
Airzim acting chief executive officer Mr Innocent Mavhunga on Tuesday said: "We are still mobilising the resources and we have made significant progress though I am not at liberty to divulge what we have. As for the stranded passengers, we are rerouting and refunding where possible. Others are still in hotels."
Mr Mavhunga said nothing had been communicated to the national airline with regards to today's pending auction. Airzim on Monday said Treasury had failed to release funds to bail it out. Last week, another Airzim plane Boeing 737-500 was grounded by a South African company, Bid Air over a US$500 000 debt.
Bid Air demanded the money for ground handling services rendered to the airline, but later released the plane after negotiations.
Mr Mavhunga told legislators in October that the national airline owes suppliers and other service providers US$137,7 million with US$112,7 million owed to Zimbabwean firms while US$25 million is owed to foreign companies. A former Airzim chief executive officer, who spoke on condition of anonymity, said the future of the airline relied on good corporate governance and personnel with relevant skills.
"For instance we have had about four or five lawyers being appointed as CEOs or managers yet they did not have any aviation knowledge," he said.
He said Government should appoint a board with aviation expertise. He said the board should be allowed to appoint an aviation expert as a CEO who will in turn appoint directors who have an understanding of the aviation industry.
"After those appointments, Airzim should be able to operate viably and that is when Government can consider taking over the debt, because taking it over now will not solve the underlying problems. After that, one can then look for a strategic partner because the airline's value would have been improved.
"It's not possible to go for a partner now when you have a negative balance sheet and if anyone comes now they will get it for a song," he said.
Source - TH
